The FINANCIAL — Ralph Burleson, CEO of GeoCapital, privately held by a small group of Georgian and US citizens, including Mark Mullen from Transparency International, is going to lead the largest direct US investment in Kutaisi, Western Georgia, providing micro-financing and financial education across the region.
“All of our investment has come from family and friends,” Ralph Burleson told The FINANCIAL.
“We currently have about 2 million USD in Georgia, we are on track to increase this amount to 5 mln USD by the end of 2012, then to 20 mln USD in 2013. We are dedicating all of our time, energy and finances into these two areas: financing and financial education. There is a lot of money to be made here in real estate, but we will leave these investments to others and focus on lending,” Burleson said.
By the end of 2012 the company plans to have 5 mln USD in small loans given to people in Georgia. “Because we are based in Kutaisi most of these loans will be provided to people in Imereti,” he said.
GeoCapital has been lending to select people in Kutaisi since early 2011. “We used these initial months to refine our loan products and build our current team,” Buleson said.
“We are a group of private citizens from the US and Georgia and not affiliated with any particular organization. We are 100% focused on Georgia. We have no plans to expand outside of Georgia any time soon.”
“When we decided where to open first, the choice was between Kutaisi and Tbilisi. We chose Kutaisi for three main reasons:
Kutaisi is centrally located. GeoCapital will have locations across ALL of Georgia and Kutaisi is right in the middle of the country, making travel to the other areas much easier.
Because of its smaller size, Kutaisi is an easier place to run a business like GeoCapital than Tbilisi. Our teams are constantly moving between our offices, the Reestri and client houses. Logistically, running our business in Kutaisi is relatively easy.
And Western Georgia is a great place to start a company for the following reasons: In Kutaisi for example, there is an untapped source of talented people looking for work.
Kutaisi is in the beginning of an economic renaissance, and we are lucky to be here at the beginning of the growth.
Parliament and other institutions will be moving here soon. These organizations will bring jobs and money that will flow through to the local economy creating opportunity for all types of businesses from coffee shops to mobile auto detail services. GeoCapital wants to help people in Kutaisi build a great tomorrow.”
Q. What is your evaluation of the micro-financing sector in Georgia? Particularly since Fitch said that Georgia is over-banked.
A. While I have great respect for the opinions of Fitch, I think that their “Over-Banked” statement is naive and misguided. A higher number of smaller banks (and MFIs) increases personal accountability in each of these organizations.
I actually believe that countries like the US are Under-Banked, with massive financial companies (like Bank of America) exercising incredible power with limited accountability.
I wish that banking in the United States was made up of collections of thousands of smaller community banks instead of a handful of giant firms. If our US banking system had been comprised of smaller, local banks with local bankers who were personally responsible for the housing loans they made, we would have avoided our current global financial crisis.
Everywhere in the world, competition is good for consumers. Choice is good for consumers. People in Georgia are lucky to have so many banks fighting for their business.
We are happy to bring GeoCapital to Georgia and give people a better choice by lowering rates and improving service.
Q. Why was the official opening delayed? Since you have been in Georgia for almost a year.
We delayed our grand opening because we wanted to build enough of GeoCapital so that people would see us for who we really are and also to give them a view of who we will be in the future.
Our new building is a big deal for us. It gives us a central place to grow our company and we wanted to share its dedication and GeoCapital with all of Georgia.
Q. You offer financing with very low interest rates. Do you have your own financial resources?
A. All of our investment has come from our families and friends. We are in discussions with institutional lenders who will fund our growth in 2013, but today all of the investment is personal. Having our own money involved gives us flexibility and personal accountability.
To the annoyance of our local competition, our plan is to keep reducing rates in 2012. Lower rates will help charge the local economy. A thriving local economy is good for everyone, especially financial service companies like GeoCapital. Our dream is to help everyone in Georgia build a better tomorrow.
BIO — Ralph Burleson was born in the US in great state of Texas. He attended Arizona State University with a double major in psychology and computer science. During the early nineties, he managed private computer hardware export projects from the US to Mexico, Brazil and Russia.
In 1996, Ralph returned to the US and joined Microsoft working in MSN operations, the Windows development team and finally Microsoft Consulting Services. In 2000, Ralph was recruited by Accenture to help launch a new IT consultancy, jointly owned by Accenture and Microsoft. Ralph and a small team of people from Microsoft and Accenture started Avanade, a $1 Billion global start-up supported and owned by two industry giants.
Ralph served Avanade in various capacities during his ten years with the firm. These roles included sales direction for the Western United States and the creation of Avanade's Global Knowledge Management Systems. As Avanade grew past 8000 employees in 2010, it was time for a change. The opportunity for Microfinance in Georgia was a perfect fit.
Ralph serves as the chairman of GeoCapital's board of directors. He also directly supports technology development in the organization.