I offered Comrades runners trust-based loans: This is what happened

The Scenario

It is the middle of October 2018 and entries have just opened for next year’s Comrades Marathon. The entries are disappearing at an unprecedented rate. Runners, particularly those from lower income groups, raise concerns that all 25,000 entries will be sold before they get paid at the end of the month and have the funds to enter.

After seeing several social media posts from anxious athletes, I decided to do a small good deed aligned with the spirit of Comrades: Offer an interest free, trust-based loan to five Comrades runners. I’d pay for their entry and they can pay me back when they have the money to do so. This is the story of what happened…

The Context – Ultra Running in South Africa

Whilst ultra running tends to be a fairly elitist sport overseas*, one of the special features of Comrades (and South African ultra running in general) is that it’s a very inclusive sport that crosses all socio-economic groups.

* There are even middle class ultra running sub-cultures overseas like the tattooed hippie, the bearded hippie, the vegan hippie, etc.

READ: Fuelling the Comrades Gold Rush (The story of Charles Mkhonto)

Another difference between South African and international ultra running is that foreign ultra runners without day jobs are known as “professional athletes” (and can generally sustain a comfortable lifestyle as such). Unfortunately, Comrades runners without day jobs are known as “unemployed”.

A significant portion of the Comrades field lives below the poverty line. I recently received the Comrades 2019 Media Pack and this point was hammered home when the breakdown of entrant’s occupations caught my eye –the ninth most ‘popular’ job is “Unemployed” (551 runners).

The R600 ($40/£32) Comrades entry fee might seem trivial to many of you reading this article on your iPad whilst sipping a latte, but for many it is a significant expense. On top of this, Comrades entries opened mid-month whereas those in the lower income groups typically get paid on the last day of the month – and do not have spare cash available for their entries.

After seeing several anxious posts on social media from stressed-out runners who were worried that all 25,000 entries would all be gone by the time payday came, an idea popped into my head during a morning training run: Why not help some fellow runners and do a bit of a social experiment at the same time?

The Experiment

The idea was to provide an interest free, trust-based loan to a minimum of five Comrades runners. I would pay for their entry fee in full and they would then pay me back once they had the money.

The risk exposure to me was R3,000 – the maximum amount I would be out of pocket if all five took the money and ran (pun intended). However, I very much doubted that would happen. In fact, I expected most would pay me back on the simple assumption that ultra runners are trustworthy and honourable people.

The reward was feeling good about myself for helping others – and I also thought it might make an interesting ‘good news’ story for my blog (which, since you are reading this article, can see is the case). I don’t pay for any advertising on my blog or to promote my social media accounts, so I figured I would chalk any unpaid entries down to ‘advertising’ and Running Mann Inc. would run at a slightly higher loss than usual.

The Vetting Process

I wanted to focus on the “trust” angle (i.e. could Comrades runners be trusted?) as well as keep things as admin light as possible. Therefore, I decided to do very basic ‘credit’ checks. For example, if the person had run Comrades before that was good enough for me. If the person was a novice and they had a social media profile I had a quick look for a running photo and, if not, I just asked for some evidence showing that they were a runner (like an online race result). This was really just to make sure that a non-runner would not infiltrate the pool of trustworthiness, get an entry and then sell it later once substitutions opened.

The response was pretty amazing. The requests came in thick and fast from runners of all abilities all around the country – and were representative of South African demographics .

I realised during the process that the one drawback with using social media to ‘advertise’ is that it excludes those who are probably the most needy but a few referral “I know a guy” requests came through as well. Based on the number of requests for help, I decided to increase the number of entry loans to ten runners (and my exposure to R6,000).

I did not want to capture the physical entry myself (as this requires having a lot of personal information on hand and, if something went wrong or was incorrect, I did not want to be to blame for someone missing out on running). Once the entry was fully captured and ready for payment, the requester let me know. I would then log onto the Comrades entry portal and process the entry payment on my credit card.

I did not want to play God deciding who were the worthiest runners for the entry loans, so I simply kept a record of the order in which requests came through with the first ten being ‘guaranteed’. I soon had a ‘waiting’ list but told those runners to enter anyway as someone else might not get their entry completed in time.

Changing the Experiment

The social media posts attracted quite a bit of attention and a friend, Warren Ingram, impressed by a rare bout of philanthropy from my side, offered to donate R3,000 for Comrades entries from Galileo Capital (where he is a director). Their sister company, Galileo Risk, immediately responded with a matching offer of a further R3,000 in sponsorship. On top of this I received contributions from a few anonymous donors who were keen to help but did not want the admin of finding entrants, vetting their credibility and processing entries.

Suddenly cash flush, I changed the parameters of the experiment to be a “subsidised” entry. Sponsors would cover R400 of the entry fee and the runner just needed to pay me back R200 – this seemed a good compromise to test the ‘trustworthiness’ of the ultra running community whilst maximising the amount of runners who could be assisted. I told those who had already paid that they only needed to pay me back R200 as Galileo Capital and Galileo Risk had covered the rest. A couple of the runners said their only problem was cashflow and paid back the full R600 despite the subsidised entry offer.

ASIDE: Who are Galileo Capital & Galileo Risk?

Galileo Risk arrange insurance for sole traders, SMEs and multi-national organisations through to cover for private individuals. They operate throughout South Africa with branches located in both Johannesburg and Cape Town, staffed by over 85 friendly, professional and enthusiastic employees. Galileo Capital is one of South Africa’s premier Wealth Management companies for wealthy families who are looking for global investment solutions.

Co-founder, director, best-selling author and financial media personality, Warren Ingram, explains why they were keen to jump in and help, “Running is probably the most inclusive sport in South Africa and is open to all South Africans. Our hope is that this sponsorship from a relatively small South African business like ours, might help some runners to reach their dream of running Comrades. It would be amazing if one of the runners we sponsored are able to inspire a future champion to start running.”

Hayden Simpson, founder and executive director (and well-known highly competitive multi-stage mountain biker) adds, “As a proudly South African company with a history of supporting SA athletes, we felt that this opportunity to support deserving SA runners could not be missed.”

Follow them on Twitter, Galileo Capital & Galileo Risk, check out their YouTube Channel for great financial advice and their website.

The Deviants

During the whole experiment I only had one ‘chancer.’ I was limiting the offer to online entry payments since I could ensure that the money went directly towards the Comrades entry. One guy was insistent that he had to do his own manual entry and asked me to “Transfer R400 as he already has the other R200.” – something didn’t smell right and, when I did a bit of digging, I found that he already had a fully paid entry but obviously wanted to get in on the R400 subsidy. The irony is that if he had told me this instead of being devious, I probably would have transferred R400 to his account.

Comrades threw their own devious curve ball on day six of the entry process. I had been frantically dealing with calls, emails and messages from desperate runners during the day and was closely monitoring the remaining entry count that was live tracking on the site. There were still about 3,000 entries left. By this stage the entries had slowed down markedly and, at the current rate, the remaining entries should have lasted well into day seven. I remember relaxing in front of the TV that evening, content in the knowledge that there was plenty of time to help get a last batch of struggling runners get registered in the morning. Then without warning the entry count suddenly went from 3,000 to 50 entries left as Comrades ‘remembered’ to subtract their manual entries from the overall availability count.

I managed to get one last runner registered in the resulting chaos but unfortunately there were several runners, many of whom had struggled with login and logistical issues* during the day, that were left stranded.

* Many of the runners who needed financial entry assistance are not the most computer literate – and many also do not have easy access to the internet, often needing to be somewhere with free Wi-Fi.

I kept my complicated spreadsheet up to date to ensure that my risk exposure remained at a maximum of R6,000. The net result of the sudden disappearance of Comrades entries meant I still had a plenty of money to play with but sadly could no longer help any further comrades out.

Moving to Plan B

Two Oceans entries would be opening within the month, so it was logical to use the remaining funds to help runners take part in the second largest ultra marathon in the world (and all sponsors were happy to have their remaining funds used in this way). This time I could be proactive and got hold of Stefanie Schultzen from the Two Oceans team to ensure that I didn’t leave any money left on the table once the 15,000 Two Oceans entries sold out.

Stefanie, then Marketing and Sponsorships Manager for the Two Oceans Marathon, told me that they were specially catering for people who might be cash-strapped by allowing entries to be processed online and then paid for up to a month later using the WebTickets platform.

The Two Oceans experiment

For Two Oceans I played it slightly differently. I was able to proactively put the word out that I had the funds to help fully sponsor or subsidise the entry for at least ten runners a week before entries opened. This time, instead of subsidising a fixed amount, I said I would pay for the entry and then runners could pay me back what they could afford.

In the end about half the requests were for fully sponsored entries and most of the others promised to pay back half of the R500 entry fee. Most of the fully sponsored entries came from requests from the committee members of running clubs who were looking for help for specific development runners on their books (which I was very happy to help out with).

I added the relevant fields to my spreadsheet and once again juggled the names and numbers to make sure I had a fully auditable process and didn’t overexpose myself. After the Comrades entries sold out in record time, I was expecting Two Oceans entries to go even faster – and sure enough, within seven hours there were none left. Therefore, my main message to those wanting financial assistance with their entries was, “Make sure you get your entry in – once it’s there we can sort everything else out”.

Once again those requesting help were of all running abilities and very representative of the South African population. I followed the same simple vetting as before – a previous Two Oceans finish or verification that the person was a runner was good enough to secure my trust. I even had a couple of people who initially asked for help, but then came back and said, “Don’t worry I made another plan – give the money to someone who needs it more.”

The Outcome

By the time all 40,000 Comrades and Two Oceans entries were accounted for, I am proud to say that about 0.1% of the field had been assisted by this process (that’s 40 runners for the mathematically challenged). I was feeling pretty good about myself but how was my bank balance looking?

One of the other things I decided was that I was not going to beg, plead and harass people for payment. I would send one message with my bank account details and that would be it. I generally lead a busy life, so it was a couple of weeks after both Comrades and Two Oceans entries closed that I sent out the ‘here’s my bank account details’ messages. However, there was no chance of forgetting because I got a steady stream of “I’m ready to pay” and “Don’t forget to send me your bank account details” reminders!

Out of all the people who took an entry loan, there was just one that never paid me back – and I was happy to write off that small amount of bad debt to good will! I would say that this small, simple experiment emphatically proves that ultra runners are amongst the most trustworthy people on the planet. Hopefully some actuaries read this article and take note – it would be nice to know that by finishing the Comrades or Two Oceans ultra marathons one’s credit score improves and ultra runners are given access to discounted interest rates!

Afterword

I choose to black out the names of runners who received assistance in the screen caps within this article as I consider people’s financial situations a private matter. However, I have made an exception below.

Nhlaka, who runs for the Inchanga-based Hlonipha Athletics Club, has a mission to make his club ‘famous’ and he wants to run as many races around South Africa as a proud Hlonipha AC ambassador. Nhlaka was one of the Two Oceans beneficiaries and, after finishing his maiden ultra marathon, spent an hour-and-a-half walking around the University of Cape Town campus on very tired legs trying to hunt me down to say thank you. The photo below was a special moment for both of us – and it really highlighted how easy it is to do a small bit of good that can make a big difference in someone else’s life!

 

Follow Running Mann:

• 
• 
• 
•