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was originally published by Harvard Innovation Labs. 
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MEET ALI, a father desperately trying to provide for his infant in Lebanon, a country in political turmoil and deep economic recession. Instead of accepting a food parcel and vouchers, Ali was able to buy much-needed diapers and medicine for his baby thanks to BitMal, a fintech platform founded by Harvard Kennedy School alumni. By transforming the way philanthropic funding is distributed, BitMal enables people like Ali to access charitable dollars in meaningful and dignified ways.

Every year, there are countless examples of public- and private-sector funding initiatives to support the lives of vulnerable children and adults around the world. But how are communities affected by the funding they receive, and can systems for allocating capital be reimagined to channel funds where communities need them the most?

Redha Alhaidar MC/MPA 2014 contemplated these questions while studying at Harvard Kennedy School a decade ago. He and his classmate Souad Abdelhamid MC/MPA 2014 began discussing a disconnect between the funding that donors allocate to underserved communities and the actual impact that funding has on people’s lives.

This disconnect, according to Abdelhamid, occurs frequently: Donors want to optimize the effect of their support but often don’t know what their beneficiaries really need. As a result, the funding may fail to have the intended impact. Also, donors want to ensure that funds are used efficiently, but they have no way to track and assess their use. Finally, even if donors are buying needed goods and services, those are often distributed in ways that the recipients find demeaning.

“There was a need to better institutionalize or incentivize community contribution,” Abdelhamid explains. “How can you ensure that the community wants to contribute and volunteer? How can you build a sense of achievement within the community?” Alhaidar and Abdelhamid decided to build an online marketplace where the target recipients could earn points, called BitMals, through volunteering or making other contributions to their community. They could use those points to select food, apparel, and other necessities from the BitMal marketplace.

BitMal launched its pilot with refugees in Jordan in 2019, which led to a series of initiatives with schools across the Arab world. In reflecting on the decade since her time at ����vlog����, Abdelhamid shared the circumstances that helped her and Alhaidar launch BitMal five years after they first spoke about the company; their startup successes and learnings after commercialization; and what the future holds for the organization.

A five-year journey from idea to launch

AFTER GRADUATING from Harvard Kennedy School in 2014, Abdelhamid pursued a career at the World Bank Group in Washington, D.C., and Alhaidar held board seats at the Misk Foundation and Tihama Group while leading civic engagement initiatives. During that time, he also raised funding and support for BitMal, advocating not only for the BitMal ecosystem but for using emerging blockchain technologies to build the marketplace.

“Sometimes, when you come up with something very innovative, it’s difficult to implement because adoption is not yet there,” Abdelhamid explains. Although people were “very skeptical” about blockchain in 2014, things had changed by 2018, and BitMal was chosen for a pilot as part of a World Bank Group competition. The following year, Abdelhamid left her role at the World Bank Group to cofound BitMal. The next step was building a platform for its pilot in Jordan.

Learning from a startup’s first real-world implementation

BITMAL PARTNERED WITH Ruwwad Al-Tanmeya (Pioneers of Development), a nonprofit nestled in a refugee camp in Amman, Jordan. Ruwwad Al-Tanmeya had already started a program whereby Palestinian refugees provided volunteer service in exchange for scholarships, which Abdelhamid described as “fully aligned with what we wanted to do.” Other elements of the community that made this an ideal location for BitMal’s first implementation included widespread adoption of mobile phones, access to the internet, and a group of volunteers who were willing to take on leadership roles.

“Students were a big component of the community,” Abdelhamid says, “and then you had the moms from the refugee community who were extremely ambitious about wanting to do something for their family. They wanted to lead their own volunteer projects. These two were our target segments.”

When BitMal’s leadership team got the two groups together to explain the concept at their first meeting, the community members immediately understood the value and were eager to implement BitMal’s reward system.

Honing a startup’s business and technology focus during expansion

AFTER COMPLETING A six-month pilot in Jordan, BitMal launched what would become a two-year program in Lebanon. “We started with a school for Syrian refugees in Tripoli, one of the poorest poverty pockets in Lebanon,” Abdelhamid says. “They were very open to innovative ideas and wanted to do anything to support their students and teachers.”

Within the Tripoli school, BitMal focused on teachers, whose salaries had been cut from $400 to around $40 a month owing to currency inflation. Low compensation made it hard to retain teachers, and BitMal worked with school leaders to help meet their basic needs. In exchange for the hours they worked, teachers would earn BitMal points they could use to buy essential goods. “They didn’t feel that this was a donation,” Abdelhamid says. “They really felt it was something they had worked for.”

BitMal’s work in Lebanon resulted in several additional insights that have been essential to the organization’s continued growth. First, Abdelhamid explains, “In Lebanon, we weren’t allowed to use blockchain. And blockchain was super-rigid. Once you build something, it’s complicated and expensive to change anything within the platform.” So BitMal built a marketplace using a digital points-based system that would be accepted in Lebanon.

Second, Abdelhamid and Alhaidar learned how important it is to listen to the community. With deep insights into its needs and preferences, they could provide the appropriate goods and services, right down to favored brands of food.

Third, when BitMal started working with the Tripoli school, Abdelhamid connected with Thara Pillai, the director of alumni programs and engagement at the Harvard Innovation Labs, for advice. Recognizing the many potential applications for BitMal’s marketplace, Pillai suggested focusing first on only one vertical: schools.

“I have kept telling Thara she has helped us achieve success,” says Abdelhamid. “She taught me that if you’re starting with schools, focus on schools, and achieve success with schools. We followed her advice, and that helped us win a contract with Takaful Foundation, the charity arm of the Ministry of Education in Saudi Arabia.”

Looking toward the future

IN 2024, BitMal successfully onboarded two schools in Saudi Arabia, where they help children secure necessities from the BitMal marketplace. Students volunteer and earn good grades in exchange for marketplace credits.

While building the marketplace, BitMal conducted focus groups with students to understand their needs and partnered with local merchants and aggregators, including Jahez, one of the leading food-delivery apps; NANA, the first online shopping and delivery service in Saudi Arabia; and Jareer Bookstore.

A director at one of the schools says, “Students earned experience, expertise, and exposure in managing their financial resources and accounts on the BitMal platform, which allowed them to positively contribute to and impact their communities. Students who volunteered felt a sense of fulfillment and achievement, and reinforced their self-value. They walked with pride and with a smile; they became known for having done something positive within their community; and they earned leadership skills that will serve them in the future.”

Abdelaziz Al Jifry, the community relations lead at Jahez, says, “Our partnership with BitMal underscores our commitment to serving the community by providing seamless and efficient delivery services. We look forward to continuing our collaboration and supporting the innovative initiatives that enhance the marketplace experience for all stakeholders.”

In reflecting on the past five years, Alhaidar and Abdelhamid are content with the time and attention to detail the BitMal team has applied to starting and growing their organization.

“It is critical to understand the needs of the community through a bottom-up approach to ensure that they are met in a dignified manner,” says Abdelhamid. “We have invested time and effort to understand these needs and build an incentive system to encourage people to further contribute. This ecosystem enables funders to optimize their impact in a transparent manner. The power of our solution and systems is that they can be used to support any community in different contexts.”

She adds, “It’s like you’re building a house. You take the time to build the infrastructure so it doesn’t fall. And then once success comes, you’re on solid ground.”

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Khalil Mazraawi/AFP/Getty Images