Spotlight — Wrisk
The UK has seen a rapid surge in the number of InsurTech startups in the last 12 months, and as a result the Insurance industry is (finally) moving into the digital age.
We sat down with Wrisk’s Co-Founder and CEO, Niall Barton, to find out how the Wrisk team is changing the status quo within InsurTech.
To date, Wrisk has raised over £3.5m including a crowdfunding round. In this spotlight Niall shares his experiences of crowdfunding with Seedrs, his views on the growth of InsurTech and the benefits of working with larger corporates like Hiscox and BMW.
Tell us a bit about your career and how you got into InsurTech?
I’ve been in the insurance sector for my whole career; I became tired of ghastly experiences customers were having and in the end, I thought it’s probably about time to do something about it.
If you told me two years ago that I’d have an office sandwiched between Vice Media and Nobu Shoreditch I’d never have believed you.
As a whole, there’s a tremendous and natural resistance to change within the industry. Of course, insurance is a wonderful lubricant to our economy but it’s by no means an entrepreneurial sector. In order to influence change, you have to have credibility; credibility in terms of (financial) backing and credibility because it’s a heavily regulated industry.
There are two types of companies in InsurTech; those who are building the plumbing behind the scenes (like running data analytics for existing businesses), and then a few who are right on the front end, changing the product for the customer. Wrisk is right at the front end.
What are the main barriers to entry for InsurTech companies and how did you overcome them?
There’s a far longer cycle to get a business off the ground than in most sectors (because of the due diligence, compliance, and investment required). It takes time to build a new product from the ground up and time to build up interest. This is a marathon, not a sprint; we have to keep our heads down and not get flustered.
Insurtech investments in the UK have soared in the past year, do you expect this upward trend to continue?
I don’t think it will go up infinitely. People will be watching to see how we get on. There’s a huge amount of investment potential, but not enough InsurTech businesses to put money into at the moment.
It’s a challenging and complicated industry so I don’t think there will be many InsurTech businesses (relative to other tech sectors).
There’s only a few of us at the moment so it means we’re keen to support and encourage each other.
This is a marathon, not a sprint; we have to keep our heads down and not get flustered.
I’d also say that the size of the pie is huge, so we don’t need to tread on each other’s toes. For example, I’ve connected with Harry, CEO of Zego (who’s also in the building) to understand where there’s crossover. We’re working in completely different areas but (it’s great that) we can learn from each other.
What has been the key to Wrisk’s success thus far?
For us (newer entrants) to succeed we must cooperate and collaborate with incumbents which makes us very different from other sectors.
We’re not rude about incumbents, we don’t use the word ‘disruption’.
Instead we work with various insurers including Hiscox who have a tremendous amount of resilience, but they recognise that they need to (innovate and) reinvent themselves so it’s a really interesting fit.
Tell us how you work with Incumbents?
Hiscox is one of the smartest insurers in the UK scene. I’ve known them throughout my career and I bumped into the CEO (Bronislaw Edmund Masojada) who asked me what I was up to. I told him about Wrisk and he wanted to come in to see our office. It could have been like a fox showing up to a chicken pen!
I rang up his secretary the day before and said he could only come in if he wore a t-shirt. So he did!
He spent a few hours with the team and bought into the idea. I went back to him three months later and he said Hiscox would invest.
Hiscox wanted to learn how we’re doing it, so we all share ideas and thoughts. It’s not that we have the right way, it’s just that it’s very different. They have a big structure so I tip my hat off to them, they’re prepared to experiment which is difficult given their size and structure. It is a great learning exercise both ways and a valuable relationship.
You recently raised £600K through Seedrs. What made you choose to crowdfund?
We looked at challenger banks who successfully engaged and built their customer base by letting customers have shares in their business. We’d always penciled ourselves in to do a crowdfunding round, but it took a lot of work to prepare.
Funnily enough, I’ve just had lunch with the founder, now Chairman of Seedrs, Jeff Lynn and we were discussing the experience (we had).
Crowdfunding is a really great British success story. Investors love it.
One investor asked to meet me recently and it transpired that he had actually already invested in us through Seedrs, he was very supportive.
Crowdfunding gives you the opportunity to build and engage your customer base. It’s brilliant as it helps brand awareness as well as raising capital. It also required us to be very disciplined, to think a lot about our messaging material through to the product experience.
You’re planning to raise a Series-A later in 2018. What advice would you give to other Founders who are between funding rounds?
Enjoy not being distracted by going to investors every 5 minutes. There’s a period of deafening silence which is good, take advantage of that.
You don’t get a long rest (though). Between rounds, you need to be planning the next one and starting the right discussions. From an outsiders point of view, it’s difficult to imagine trying to run a business and raise funds all the time. One of the key tips I’d give to all startup founders is that you need to make sure you have enough capacity in your organisation to do both. My co-founder, Darius has a large focus on the day-to-day business, whereas I spend a lot of time on everything investor related.
Tell us more about Darius. How did you meet?
We met at an InsurTech dinner that I wasn’t sure I wanted to go to. I remember Darius seemed to be one of the more interesting guests, so we got talking. We quickly realised we shared similar views on the future of insurance, so I invited him to spend a few days working with me — we haven’t looked back since.
In this sector, you have the insurance people and the technology people. His job is to run the whole thing and steer two very different cultures. You couldn’t pick two more different cultures and his job is to make them work altogether all the time.
It works well because he and I are very different, yin and yang! But you need that. I’ve had to go backward to go forward. I knew what I wanted Wrisk to become but I couldn’t do it all myself. We’ve both learnt quite a bit from each other.
How much of your success would you attribute to luck, versus hard work?
People say it’s 20% inspiration, 80% perspiration.
You have to be out there to find the lucky breaks and opportunities. For example, we were asked to join the BMW Innovation Lab, and it has turned out to be one of the best partnerships. They’ve given us a track record of working with a big company, and enabled us to experiment with B2C models. They’re a brilliant organisation to work with and they’ve got plenty out of working with a startup as well.
Having said that, timing is a key ingredient. I’m grateful that the timing is right for us. The timing of the sector picking up speed and investors wanting more InsurTech. We’ve sort of popped our heads above the parapet at the right moment.
In terms of hard work, you’ve got to build a foundation that is strong (in terms of partnerships and talent) to move forward. I’d say that’s been key to our success to date. You’ll go further if you’ve got broader credibility. If you’re hostage to one, or think you can do it all yourself, (it’s unbalanced) and is less likely to work out.
Other than to make money, why does Wrisk exist?
Wrisk is two-thirds missionary, one-third mercenary.
Giving something back is incredibly rewarding. It’s not why we’ve done it but it’s an important ingredient.
I previously set up a venture to help people with the transition from school to work. The outside world is terrifying to some students and teachers have no idea how to prepare people. I still have a strong relationship with the academy; the school caters to students who have been excluded from multiple schools, and I saw the magic they create by helping students build their own self control systems.
One of their guys comes in once a week. When he first came in first 3–4 months ago he was intimidated but now I’ve seen the lights come on and he feels more comfortable. The experience has normalised his view of how a (typical) company works, something we take for granted. We’re all pinching ourselves that we’ve got a lucky break but lots of people haven’t.
Purpose was never on the horizon when I started work but it is much more about that now. Giving something back is incredibly rewarding.
What advice would you give to someone just starting their career?
Be inquisitive, try things.
I didn’t know what I wanted to do at 21. I actually met a graduate recently, he’s 21, I told him to get a job, for instance at Specsavers. It doesn’t matter if it’s not what you want to do, just go and find out how businesses work, their strategy, how they look after their staff. Ask and learn. Then when you get your next job interview you can say, I tried it, didn’t like it, but here’s what I learnt.
If I was interviewing someone I’d want someone who is inquisitive and will try things out. If you told me I’d be working in a tech business in Shoreditch 5 years ago I wouldn’t have believed you — you never know where you’re going to end up. Ultimately you just need the right characteristics.
Secondly, it’s old-fashioned, but ‘manners are still incredibly important’. People who have manners will be good with other staff and with your customers. I immediately notice if someone has them. It might not be fashionable but manners are an incredibly relevant skill at a time when robots can do lots of stuff we can do!
What are you focusing on at the moment?
In December we gained regulatory authorisation from the Financial Conduct Authority (FCA) and were selected to join their sandbox. We were selected from a group of 60 and are only one of 3 insurance companies to make this cohort. End-to-end testing of our content product will start within the sandbox in March and we are busy recruiting testers –of course we’d love anyone at Techspace to be a part of our community of testers!
Post the sandbox, we have our eyes set on an iOS ‘beta’ launch in Spring and we’re simultaneously building and designing additional product lines around motor and buildings insurance. With such a packed roadmap, we are rapidly growing too.
What are your 5/10 year goals?
Within 3 years, we’d like to have a distinctive brand in UK and maybe a few others. Longer-term, bearing in mind the partners we already have, Europe and the Middle East look promising for Wrisk. We feel the product has a really universal appeal.
As we grow, (most importantly) it’s all about keeping the magic.
That’s a key part that I see as my responsibility. As we grow, we’re going to need a bit more rigour and a bit more structure but we don’t want to lose the buzz we have now.
Learn more about Wrisk’s upcoming beta launch on their blog; learn about crowdfunding, plus the unexpected bonuses of engaging with regulators.
