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Planck, the insurance data analytics platform, raises $20M growth round
Planck co-founders (from left to right): David Schapiro, CEO Elad Tsur and CTO Amir Cohen. Image Credits: Planck
Planck, the AI-based data platform for commercial insurance underwriting, announced today it has raised a $20 million growth round. The funding came from 3L Capital and Greenfield Partners, along with returning investors Team8, Viola Fintech, Arbor Ventures and Eight Roads.
This brings the New York-based startup’s total raised to $48 million, including a $16 million Series B it announced in June 2020. Planck said it currently works with “dozens of commercial insurance companies in the U.S.,” including more than half of the top-30 insurers. It will use its new funding to build its U.S. team, expand into global markets and add products for new business segments. Ernie Feirer has also joined Planck as its head of U.S. business. He previously held leadership roles at LexisNexis Risk Solutions, building data analytics solutions for property and casualty insurance carriers.
Planck’s database, which includes online images, text, videos, reviews and public records, allows it to give insurance providers real-time information that helps them determine premiums, process claims and give SMEs faster quotes. It covers more than 50 business segments, including restaurants, construction, retail and manufacturing, and can deliver analytics by simply entering a business’ name and address.
For example, if a healthcare business is seeking to buy or renew an insurance policy, Planck can give underwriters information such as the type of equipment used, what kind of drugs it prescribes and the type of surgeries it performs.
In a statement, 3L Capital principal Paige Thacher said, “Commercial carriers and brokers can no longer afford to rely upon traditional data sources as they prospect, assess risk and monitor a small business insured’s changing exposure during the policy life cycle. The new imperative is to leverage AI and machine learning technologies to dynamically harvest business insights from the insured’s digital footprint.”
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Shift Technology raises $220M at a $1B+ valuation to fight insurance fraud with AI
While incumbent insurance providers continue to get disrupted by startups like Lemonade, Alan, Clearcover, Pie and many others applying tech to rethink how to build a business around helping people and companies mitigate against risks with some financial security, one issue that has not disappeared is fraud. Today, a startup out of France is announcing some funding for AI technology that it has built for all insurance providers, old and new, to help them detect and prevent it.
Shift Technology, which provides a set of AI-based SaaS tools to insurance companies to scan and automatically flag fraud scenarios across a range of use cases — they include claims fraud, claims automation, underwriting, subrogation detection and financial crime detection — has raised $220 million, money that it will be using both to expand in the property and casualty insurance market, the area where it is already strong, as well as to expand into health, and to double down on growing its business in the U.S. It also provides fraud detection for the travel insurance sector.
This Series D is being led by Advent International, via Advent Tech, with participation from Avenir and others. Accel, Bessemer Venture Partners, General Catalyst and Iris Capital — who were all part of Shift’s Series C led by Bessemer in 2019 — also participated. With this round, Paris-and-Boston-based Shift Technology has now raised some $320 million and has confirmed that it is now valued at over $1 billion.
The company currently has around 100 customers across 25 different countries — with the list including Generali France and Mitsui Sumitomo, to give you an idea of where it’s pitching its business — and says that it has already analyzed nearly two billion claims, data that’s feeding its machine learning algorithms to improve how they work.
The challenge (or I suppose, opportunity) that Shift is tackling, however, is much bigger. The Coalition Against Insurance Fraud, a nonprofit in the U.S., estimates that at least $80 billion of fraudulent claims are made annually in the U.S. alone, but the figure is likely significantly higher. One problem has, ironically, been the move to more virtualized processes, which open the door to malicious actors exploiting loopholes in claims filing and fudging information. Another is the fact that insurance has grown as a market, but so too has the amount of people who are in financial straights, leading to more desperate and illegal acts to gain an edge.
Shift is also not alone in tackling this issue: the market for insurance fraud detection technology globally was estimated to be worth $2.5 billion in 2019 and projected to be worth as much as $8 billion by 2024.
In addition to others in claims management tech such as Brightcore and Guidewire, many of the wave of insurtech startups are building in their own in-house AI-based fraud protection, and it’s very likely that we’ll see a rise of other fraud protection services, built out of adjacent areas like fintech to guard against financial crime, making their way to insurance. As many a fintech entrepreneur has said to me in the past, the mechanics of how the two verticals work and the compliance issues both face are very closely aligned.
“The entire Shift team has worked tirelessly to build this company and provide insurers with the technology solutions they need to empower employees to best be there for their policyholders. We are thrilled to partner with Advent International, given their considerable sector expertise and global reach and are taking another giant step forward with this latest investment,” stated Jeremy Jawish, CEO and co-founder, Shift Technology, in a statement. “We have only just scratched the surface of what is possible when AI-based decision automation and optimization is applied to the critical processes that drive the insurance policy lifecycle.”
For its backers, one key point with Shift is that it’s helping older providers bring on more tools and services that can help them improve their margins as well as better compete against the technology built by newer players.
“Since its founding in 2014, Shift has made a name for itself in the complex world of insurance,” said Thomas Weisman, an Advent director, in a statement. “Shift’s advanced suite of SaaS products is helping insurers to reshape manual and often time-consuming claims processes in a safer and more automated way. We are proud to be part of this exciting company’s next wave of growth.”
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Big Tech is now worth so much we’ve forgotten to be shocked by the numbers
Welcome back to The TechCrunch Exchange, a weekly startups-and-markets newsletter. It’s broadly based on the daily column that appears on Extra Crunch, but free, and made for your weekend reading. If you want it in your inbox every Saturday morning, sign up here. Ready? Let’s talk money, startups and spicy IPO rumors.
TechCrunch isn’t a public-market-focused publication. We care about startups. But public tech companies can, at times, provide interesting insights into how the broader technology market is performing. So we pay what we might call minimum-viable attention to former startups that made it all the way to an IPO.
Then there are the Big Tech companies. In the United States the list is well-known: Facebook, Alphabet, Microsoft, Apple and Amazon. And, in a series of results that could indicate a hot market for startup growth, they had a smashingly good first quarter of 2021. You can read our notes on their results here and here, but that’s just part of the story.
Yes, the Big Tech financial results were good — as they have been for some time — but lost amid the usual earnings deluge of numbers is how shockingly accretive Big Tech’s recent performances have proven for their valuations.
Microsoft fell as low as the $135 per-share range last March. Today it’s worth $252 and change. Alphabet traded down to around $1,070 per share. Today the search giant is worth $2,410 per share.
The result of the huge share-price appreciation is that Apple is now worth $2.21 trillion, Microsoft $1.88 trillion, Amazon $1.76 trillion, Alphabet $1.60 trillion and Facebook $0.93 trillion. That’s around $8.4 trillion for the five companies.
Back in July of 2017, I wrote a piece noting that their aggregate value had reached the $3 trillion mark. That became $4 trillion in mid-2018. And then in the next three years or so it more than doubled again.
Why?
Myles Udland, a reporter at our sister publication Yahoo Finance, has at least part of the puzzle in a piece he wrote this week. Here’s Udland:
And while it seems that almost every earnings story has sort of followed this same arc, data also confirms that this is not just our imagination: corporate earnings have never been this far out of line with expectations.
Data out of the team at Refinitiv published Thursday showed the rate at which companies were beating estimates and the magnitude by which they were beating expectations through Thursday morning’s results were the best on record.
So earnings are beating the street’s guesses more frequently, and at a higher differential, than ever? That makes recent stock-market appreciation less worrisome, I suppose. And it helps explain why startups have been able to raise so much capital lately in the United States, as they have in Europe, and why private-market investors are pouring so much capital into fintech startups. And it’s probably why Zomato is going public and why we’re still waiting for the Robinhood debut.
This is what a market feels like when the underlying businesses are firing on all cylinders, it appears. Just don’t forget that no business cycle is unending, and no boom is forever.
An insurtech interlude
Extending The Exchange’s recent reporting regarding fintech funding, and our roundup from last week of insurtech startup rounds, a few more notes on the latter startup niche, which can be broadly viewed as part of the larger financial technology world.
This time we’ll hear from Accel’s John Locke regarding his investments in The Zebra — which recently raised even more capital — and the insurtech space more broadly.
Asked why insurtech marketplaces like The Zebra have been able to raise so very much money in the last year, Locke said that it’s a mix of “insurance carriers […] finally embracing marketplaces and willing to design integrated consumer experiences with marketplaces,” along with more consumer “comparison shopping” and, finally, growth and revenue quality.
The Zebra, Locke said, is “still growing north of 100% at ~$120M+ revenue run-rate.” That means it can go public whenever it wants.
But on that matter, there has been some weakness in the stock market for some public insurtech companies. Is Locke worried about that? He’s neutral-to-positive, saying that his firm does not “think all the companies in the market will work but still thinks ‘insurtechs’ will take market share from incumbents over the next decade.” Fair enough.
And Accel is still considering more deals in the space, as are others. Locke said that the venture market for insurtech investments is “definitely more aggressive” this year than last.
Various and sundry
Closing today, a few notes on things that we didn’t get to that matter:
- Productboard closed a $72 million Series C. First, that’s a huge round. Second, yes, Tiger did lead the deal. Third, the product management software company has around 4,000 customers today. That’s a lot. Add this company to your two-years-from-now IPO list.
- Chinese bike-sharing startup Hello is going public in the United States. We are going to get back to this on Monday, but its F-1 filing is here. The company turned $926.3 million worth of 2020 revenues into $109.6 million in gross profit, and a net loss of $173.7 million in net losses. Yowza.
- Darktrace went public this week. I know of it because it sponsors an F1 team that I adore, but it enters our world today as a recent U.K.-listed company. And after Deliveroo went kersplat, the resounding success of the Darktrace listing could make the U.K. a more attractive place to list than it was a week ago.
- And, finally, drone delivery is, maybe, coming at last? U.K.-listed venture capital group Draper Esprit led the $25 million round into Manna, which wants to use unmanned drones in Ireland to deliver grub. “Manna sees a huge appetite for a greener, quieter, safer, and faster delivery service,” UKTN reports.
A long, weird week. Make sure to follow the second denizen of The Exchange’s writing team: Anna Heim. Okay! Chat next week!
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Insurtech startups are leveraging rapid growth to raise big money
The investment landscape for insurtech startups is off to a hot start in Q2 2021. Since the end of the first quarter, we’ve seen several players in the broad startup category announce new capital, including Clearcover, Alan, Next Insurance and The Zebra.
But, as anyone who’s familiar with startups that offer insurance-related products and services knows, the sector is enough of a mixed bag that one needs to segment down to get clarity on how constituent companies are performing. So while Clearcover’s $200 million round from last week, Next Insurance’s $250 million round from the first of the month and Alan’s $220 million round from yesterday are interesting, this morning we’re going to focus a bit more on The Zebra’s side of the insurtech house.
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The Exchange divides insurtech startups into three categories: neoinsurance providers, insurtech marketplaces and insurtech enablers. (You can see why we need to segment the insurtech genre!)
Briefly, neoinsurance providers are companies like Root, Metromile and Next Insurance, which use technology to underwrite and sell insurance in an updated manner; these companies also often have optimized mobile experiences.
Marketplaces like The Zebra, Gabi, Insurify and others provide a way for consumers to better identify their insurance options. And, finally, there are companies like AgentSync, which fit neatly into our third category of firms that help other companies in the insurance business digitize their operations or otherwise modernize.
Insurtech marketplaces came back into our view when The Zebra put together a $150 million Series D earlier this month and released a host of metrics regarding its growth, and Insurify dropped the news that it is partnering with Toyota.
This morning, let’s discuss insurtech’s 2020 as a whole, peek at some preliminary 2021 venture data and then dive deep into what we’ve collected regarding growth among insurtech marketplace players. The Exchange has data and other details from The Zebra, Insurify, Wefox and more.
Covering longitudinal progress of specific startup categories is one of our favorite things to do. So, please, walk with us!
2020 to today
PitchBook data regarding the insurtech category in 2020 underscores how large the startup niche has grown. Per the data company, $18.3 billion was spent last year on insurtech startups across venture capital, private equity and M&A activity. That was a billion dollars under its 2019 result, but given the pandemic’s onset, 2020’s final result is somewhat impressive — who expected insurance investing to hold up during an unprecedented global catastrophe?
This year is proving lucrative for the insurtech market, at least from a venture capital perspective. Normally I’d make a joke about how unprofitable some neoinsurance providers are at this juncture, but because our focus is elsewhere, bringing up the fact that, say, Lemonade’s adjusted losses in the final quarter of 2020 were around 150% of its revenue is kind of irrelevant. So we won’t!
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Alan raises $220 million for its health insurance and healthcare superapp
French startup Alan has raised a $220 million funding round at a $1.67 billion valuation (€185 million and €1.4 billion respectively). Coatue is leading the round with Dragoneer, Exor, and existing investors Index Ventures, Ribbit Capital and Temasek also participating.
Alan has been building health insurance products from scratch. When I first covered the company back in 2016, the startup had just managed to get approval from regulators to become an official health insurance company.
Since then, it’s been a not-so-slow-and-steady growth story as the company now covers 160,000 people. Overall, Alan generates over €100 million in annualized revenue. While most of that revenue is spent back on claims, it’s an impressive revenue trajectory.
Like other insurance companies, Alan has some capital requirements to comply with health insurance regulation. Alan has to raise more if it wants to insure more people. But that’s just part of the story as the startup still had enough cash on its bank account for the next 12 to 18 months.
“The context is that we managed to end the year 2020 very strong, finally — and I say finally because it’s been stressful until the last minute,” co-founder and CEO Jean-Charles Samuelian-Werve told me.
Alan managed to meet its goals and international expansion finally started to take off. Many startups try to raise when they’re in a strong position. You shouldn’t wait until you have your back against the wall and that’s exactly what’s happening here.
“We thought it was the right time and we had multiple term sheets. Even though valuation is really good we first looked at a partner that has a really long-term vision,” Samuelian-Werve said.
With today’s funding round, the company can iterate on its core product — health insurance — and everything that makes Alan a superapp — a single app that lets you access several services. In France, employees are covered by both the national healthcare system and private insurance companies. Alan sells its products to other companies so that their employees are automatically covered by Alan contracts. It’s a sort of B2B2C play.
9,400 companies have opted for Alan in France, Belgium and Spain — the company’s home market remains its main market. Clients include WeWork, Deliveroo, JustEat, Vitaliance and Big Mamma. By 2023, Alan wants to reach 1 million members.
In order to gain more customers, Alan is betting on three pillars — product innovation, customer satisfaction through additional services, and expansions to new verticals and markets.
When it comes to product innovation, Alan has designed a modular insurance builder. Small companies can subscribe to Alan in a few clicks. Big companies can tweak every single parameter to build the right insurance package for them.
After that, the company tries to make it easy to manage your health insurance. You’ll soon be able to automatically manage sick leaves, change the employee affiliation status, etc. As for employees, the company has always promoted a transparent offering. For instance, you should know how much you’re going to pay out of pocket when you see a doctor. You can see a map of doctors around you and how much they charge on average. This way, there’s no surprise.
Alan also tries to reimburse you as quickly as possible. If it’s a straightforward claim, the startup tries to analyze and categorize your claim as quickly as possible and then issue an instant SEPA transfer. Seventy-five percent of claims are reimbursed and available on your bank account in less than an hour.
These core product features definitely contributes to customer satisfaction. But Alan is expanding beyond insurance products with several additional services that should increase retention. For instance, you can chat with a doctor, get medical advice for your baby’s health, get a free meditation app subscription, start a telehealth appointment via a partner, talk with someone about your mental health, etc.
Those services contribute to turning Alan into a superapp for your health. Essentially, as soon as you’re insured by Alan, you become a member and can access all those services without additional charges.
Eventually, Alan plans to launch a personal care guidance service to help you contact the right healthcare professional based on your health issue. In Spain, Alan can already book appointments for you.
Finally, Alan plans to reach new customers through aggressive expansion goals. The company plans to hire 400 people within the next three years and expand to other industries with tailor-made insurance products, such as retail, wholesale and manufacturing.
While the company is still going to focus on France, Belgium and Spain in the near future, it is looking at opportunities across Europe. So let’s see where Alan is going to expand next.
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Pie Insurance raises $118M for data-driven workers’ comp coverage
Pie Insurance, a startup offering workers’ compensation insurance to small businesses, announced this morning that it has closed on $118 million in a Series C round of funding.
Allianz X — investment arm of German financial services giant Allianz — and Acrew Capital co-led the round, which brings the Washington, D.C.-based startup’s total equity funding raised to over $300 million since its 2017 inception. Pie declined to disclose the valuation at which its latest round was raised, other than to say it was “a significant increase.”
Return backers Greycroft, SVB Capital, SiriusPoint, Elefund and Moxley Holdings also participated in the Series C financing.
The startup, which uses data and analytics in its effort to offer SMBs a way to get insurance digitally and more affordably, has seen its revenues climb by 150% since it raised $127 million in a Series B extension last May. Its headcount too has risen — to 260 from 140 last year.
Pie began selling its insurance policies in March 2018. The company declined to give recent hard revenue numbers, saying it only has grown its gross written premium to over $100 million and partnered with over 1,000 agencies nationwide. Last year, execs told me that in the first quarter of 2020, the company had written nearly $19 million in premiums, up 150% from just under $7.5 million during the same period in 2019.
Like many other companies over the past year, Pie Insurance — with its internet-driven, cloud-based platform — has benefited from the increasing further adoption of digital technologies.
“We are riding that wave,” said Pie Insurance co-founder and CEO John Swigart. “We believe small businesses deserve better than they have historically gotten. And we think that technology can be the means by which that better experience, that more efficient process, and fundamentally, that lower price can be delivered to them.”
Pie’s customer base includes a range of small businesses including trades, contractors, landscapers, janitors, auto shops and restaurants. Pie sells its insurance directly through its website and also mostly through thousands of independent insurance agents.
Workers’ compensation insurance is the only commercial insurance mandated for nearly every company in the United States, points out Lauren Kolodny, founding partner at Acrew Capital.
“Historically, it’s been extremely cumbersome to qualify, onboard and manage workers’ comp insurance — particularly for America’s small businesses which haven’t been prioritized by larger carriers,” she wrote via email.
Pie, Koldony said, is able to offer underwriting decisions “almost instantly,” digitally and more affordably than legacy insurance carriers.
“I have seen very few insurtech teams that come close,” she added.
Dr. Nazim Cetin, CEO of Allianz X, told TechCrunch via email that his firm believes Pie is operating in an “attractive and growing market that is ripe for digital disruption.”
The company, he said, leverages “excellent,” proprietary data and advanced analytics to be able to provide tailored underwriting and automation.
“We see some great collaboration opportunities with Allianz companies too,” he added.
Looking ahead, the company plans to use its new capital to invest further in technology and automation, as well as to grow its core workers’ comp insurance business and “lay the groundwork for new business offerings in 2021 and beyond.”
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The technology selloff is getting to be somewhat material
Tech stocks are getting hammered today, with previously high-flying shares of software companies taking even more damage.
For a sector that has enjoyed a year in the sun, recent trading sessions have punctured a period of market adoration. It is too soon to say that the market is repricing tech stocks, but the selloff has reached the point of materiality and is therefore something we need to note.
As we write, the tech-heavy Nasdaq Composite is off another 1.2% today after previous declines. The now-infamous ARK Innovation ETF is off 6.5% and the list of individual declines worth noting in the tech sector is very long indeed.
The change in sentiment is clear in recent results. Here’s the tech-heavy Nasdaq Composite:
- Nasdaq Composite 52-week high: 14,175.12
- Nasdaq Composite today: 12,561.13
- Percent change: -11.4%
And the damage intensifies if we consider just SaaS and cloud stocks. Here’s the Bessemer cloud index:
- Bessemer cloud index 52-week high: 2,884.23
- Bessemer cloud index today: 2,185.62
- Percent change: -24.2%
In more prosaic terms, the Nasdaq is in a technical correction, while SaaS stocks have reached bear-market territory. That’s quite a turnabout from recent all-time highs for both.
Not just software
Lost on the TechCrunch editing floor from late yesterday is a post we wrote noting the sharp declines in the value of insurtech stocks ahead of the impending public debut of Hippo, another neo-insurance company. The SPAC-led Hippo flotation will not touch down in a warm market. Instead, its contemporaries look like this today:
- Lemonade 52-week high: $188.30
- Lemonade current price: $84.72
- Change: -55.0%
- Root Insurance 52-week high: $29.48
- Root Insurance current price: $12.38
- Change: -58.0%
- MetroMile 52-week high: $20.39
- MetroMile current price: $10.04
- Change: -50.8%
The damage is widespread. Hell, recent IPO success-story Snowflake announced yesterday that it grew from revenues of $88 million in its year-ago quarter to $190 million in its most recent. And its stock is off more than 7% today.
We’ll leave it to you whether the changing public valuations are just a blip or a more staid change in the winds. But it does feel different out there.
For startups, this is all somewhat poor news. Valuations for public comps were strong in 2020. To lose that halo in 2021 could crimp late-stage valuations, perhaps even reaching back to Series A and B rounds to limit some upside for growing upstarts. But such an impact will lag the public markets, so don’t expect things to change quite yet.
Still, every private investor has their eye on the exit when it comes to their deals. And if that exit is suddenly shrinking, so too might their interest in paying for quite so great a markup on their next deal.
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SoftBank makes mountains of cash off of human laziness
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.
Natasha and Danny and Alex and Grace were all here to chat through the week’s biggest tech happenings. It was yet another crazy week, but we did our best to get through as much of it as we could. Here’s the rundown, in case you are reading along with us!
- Square is buying Tidal in a deal that some are skeptical of, but one about which we found quite a lot to like.
- How capital-as-a-service can get you your first check in 2021, and a nod to Indie.VC, a pioneer in alternative financing for startups that announced it is shutting down net new investments this year.
- Oscar Health priced its IPO above its raised range, which was good for it in terms of fundraising. However, since its debut the company has lost pricing altitude. Its declines mimic those of other public neo-insurance providers in what could be a new trend.
- And sticking to the insurtech beat, Hippo is going public via a SPAC. Because everyone else is?
- Compass filed its S-1, which triggered a debate on how it’s different than Opendoor.
- Coupang’s IPO is also coming, replete with huge growth, an improving profitability picture and a massive valuation. This is one to watch.
- There was also a whole global news circuit around grocery delivery startups, with Instacart raising at a $39 billion valuation.
- And we wrapped with the Surreal seed round that we found to be more than a little spicy. As it turns out, commercialized deepfakes are not merely on the way; they are here.
And with that we are back on Monday. Have a rocking weekend!
Equity drops every Monday at 7:00 a.m. PST, Wednesday, and Friday at 6:00 AM PST, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts!
Early Stage is the premier “how-to” event for startup entrepreneurs and investors. You’ll hear firsthand how some of the most successful founders and VCs build their businesses, raise money and manage their portfolios. We’ll cover every aspect of company building: Fundraising, recruiting, sales, product-market fit, PR, marketing and brand building. Each session also has audience participation built-in — there’s ample time included for audience questions and discussion.
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InsurGrid raises pre-seed financing to help modernize legacy insurance agents
Insurance agents spend hours handling paperwork and grabbing client information over the phone. A new seed-stage startup, InsurGrid, has developed a software solution to help ease the process, and make it easier for agents to serve existing clients — and secure new ones.
InsurGrid gives agents a personalized platform to collect information from clients, such as date of birth, driver’s license information and policy declaration. This platform helps agents avoid sitting on long calls or managing back-to-back emails, and instead gives them one spot to understand how all their different clients function. It is starting with property and casualty management.
The startup integrates with 85 insurance carriers, serving as the software layer instead of the provider. Using the InsurGrid platform, insurers can ask clients to upload information and within seconds be registered as a policyholder. This essentially turns into a living Rolodex that insurers can use to access information on the account, and offer quotes on a faster rate.
Image Credits: InsurGrid
There’s a monetary benefit in providing better service. Eden Insurance, a customer of InsurGrid, said that people who submit information through the platform converted at an 82% higher rate than those who don’t. Jeremy Eden, the agency owner of Eden Insurance, said they were able to show consumers that its plan was $300 cheaper than its existing rate.
At the heart of InsurGrid is a bet from the founding team that legacy insurance agents aren’t going anywhere. Co-founder/CEO Chase Beach pointed out that the majority of the $684 billion of annual property and casualty insurance premiums in the United States is distributed by approximately 800,000 agents working in 16,000 brokerages. So far, InsurGrid works with more than 150 of those agencies.
When asked if InsurGrid ever had plans to offer its own insurance, similar to insurtech giants Hippo, Lemonade and Root, Beach said that it is solely working on innovating around the sales process for now. He said that these big companies, which have either recently gone public or are planning to, still rely on agents to be successful.
“Instead of us replacing the insurance agent, what if we gave them that same level of technology of a Hippo or large carrier,” Beach said. “And provide them with the digital experiences so they can compete in 2021.”
As time goes on, he sees insurance agents taking the same role that financial advisors or real estate agents take: “very much involved in the process because they are that expert.”
Other startups that have popped up in this space include Gabi, Trellis and Canopy Connect. The differentiator, the team sees, is that Beach comes from a 144-year-old insurance legacy, giving him key insights on how to sell to agents in a successful and effective way. It is starting with sales, but expect InsurGrid to expand to other parts of the insurance process as well.
To help them compete with new and old startups, InsurGrid recently raised $1.3 million in pre-seed financing to help it fulfill its goal to be the “underdog for the underdogs,” Beach said. Investors include Engineering Capital, Hustle Fund, Vess Capital, Sahil Lavingia and Trevor Kienzle.
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German insurtech platform Hepster raises $10M Series A led by Element Ventures
Hepster, an insurtech platform from Germany, has raised $10 million in a Series A funding round led by Element Ventures. Also participating was Seventure Partners, MBMV and GPS Ventures, as well as previous investors. The funds will be used to broaden the Hepster insurance ecosystem and scale up its network, with an emphasis on automation.
The German insurance market is famously slow at adopting new practices, and Hepster is part of a new wave of insurtech startups in the country taking advantage of this. It allows businesses to build insurance policies from scratch, matched specifically to the needs of their individual service or industry. E-commerce players, for instance, can then embed these insurance products into the e-commerce journey.
Its products are therefore better suited to the new sector of, for example, shared e-bike schemes and peer-to-peer rental platforms, which are rarely covered by traditional brokers in Germany. However, it also caters to traditional, established industries as well.
It now has more than 700 partners, including European bike retailers and rental companies Greenstorm Mobility and Baron Mobility, as well as Berlin-based cargo bike provider Citkar and Munich e-bike startup SUSHI.
Christian Range, Hepster co-founder and CEO, said in a statement: “Hepster is now a key player within the European insurance market. Our state-of-the-art technology with our API-driven ecosystem, as well as our highly service-oriented approach, sets us apart.”
In an interview he told me: “Germany is the toughest market with the most regulations, the most laws. We have a saying in Germany, if you can make it in Germany, you can make it everywhere. Also, it’s a big market in terms of selling insurance products because Germans really like insurance in every regard. So there is huge market potential in Germany I think.”
Michael McFadgen, partner at Element Ventures, said: “As new industries and business models emerge, companies need much more flexible insurance propositions than what is currently being offered by traditional brokers. Hepster is the breakout company in the space, and their focus on embedded insurance will pay dividends in years to come.”
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