Mentor-Driven Global Insurance Accelerator Is Enjoying its Own Growth-Spurt

A three-year-old Des Moines, Iowa-based business startup accelerator focused solely on the global insurance industry has developed into a streamlined organization with more applicants, more investors and more mentors than in past years, its managing director says.

“We’ve matured as an organization,” said Brian Hemesath, managing director of the Global Insurance Accelerator (GIA), which was created in 2014 as an initiative of the Greater Des Moines Partnership. Financially backed by insurance carriers, GIA held its first startup class, or cohort, in 2015.

Each year GIA selects six applicants to participate in the 100-day program in which budding companies work with mentors to develop their business model, which must serve the insurance industry in some way. The startups receive $40,000 in seed money and for the first time this year, housing for the duration of the program.

At the end of the 100 days, each company presents its business plan at the annual Global Insurance Symposium in Des Moines. This year, “demo day” is slated for April 26.

The GIA received its initial funding from seven Iowa-based insurance companies. It now boasts 10 investing insurers, two of which are located out of state. Hemesath said he expects to add even more carrier-investors for next year’s cohort, including additional insurance companies from outside Iowa.

The mentor pool, which is populated with insurance professionals from all sectors of the industry, has also grown and diversified. There are now 110 insurance-centric mentors from across the United States — plus a few from other countries — working with the program, Hemesath said.

“We’ve garnered a lot of interest in what we’re doing and the companies are realizing that our program is not only really easy to support … but we’ve been able to attract some really great talent,” he said.r

Grinnell Mutual Insurance Co., headquartered in Grinnell, Iowa, and six other Iowa insurers each committed to providing $100,000 in funding each year for at least three years.

Grinnell President and CEO Larry Jansen was an enthusiastic supporter of the program from the beginning.

“I had two ideas when I went with this. One was that if they could bring some new ideas to us as a company, to help us produce and grow more business from a technology standpoint, I thought that would be a great situation for us. The other piece was if I could find some companies that we can invest in from an investment standpoint, almost like a venture capitalist, we would do that, as well, to help grow revenue in the company,” Jansen said.

So far Grinnell has invested in a startup from each of the previous two years — Drive Spotter from the 2014 class, which is developing technology and telematics for the trucking industry, and InsuranceSocial.Media from the 2015 class, which is developing social media platforms for agencies.

“The Global Insurance Accelerator, to me, fit exactly in my vision of energizing [Grinnell], moving us forward, growing this company to a billion-dollar company in the next decade, and focusing on technology,” Jansen said.

He added that Grinnell would continue its support of the program going forward.

Hemesath said the number of applicants to the program has steadily increased, along with the maturity level of the startups, in terms of the products they’ve developed.

He cited one of this year’s participants, Boston-based InsuranceMenu, which has created a platform for distributing employee benefits to the small business market, as a prime example. “They’ve been around now two years, and they have paying customers, are making revenue and have a real product that’s in the market. We didn’t have a company like that two years ago … and we have three now this year. Three of our six have products in the market generating revenue,” Hemesath said.

A fourth participant has a marketable product and the final two are at the early concept stage, “but the concept was fascinating enough to us that we wanted to bring them in,” he said.

Nabil Aidoud, one of the founders of InsuranceMenu, said that like the insurance industry itself the GIA as a startup accelerator is unique.

“Insurance is a complicated industry with a lot of stakeholders,” and the GIA has “done an amazing job of bringing these different stakeholders together who traditionally don’t collaborate that well, and have created this little sort of mini ecosystem built around attracting startups, and innovating around that. You’re not going to find that in a lot of the other accelerators across the country or across the world,” he said.

The InsuranceMenu product aims “to transform how employee benefits are distributed to the small business market,” Aidoud said.

With 48 million Americans working for small businesses, those firms typically need an independent agent to help guide them through the decision-making process involved providing benefits to their employees, he said. Unfortunately, “because of the fragmentation at the small business market level, as well as the agent level, not a whole lot is standardized. This is where InsuranceMenu comes in. We make it easier for the employer. We make it more profitable for the agent and we bring the carriers closer to this target segment.”

The product is geared toward both agents and carriers, and to “helping the agent community work more effectively with the carrier community,” he said.

While there may be an assumption that once a company gets a product to the market it’s good to go, the truth is once the product is marketable a whole new set of questions arise. That’s what makes the GIA’s mentoring program so effective, Aidoud said.

“It’s really amazing to be able to ask questions without having to worry about people perceiving you as being immature or not ready for full-time production. To be able to talk to potential customers … about my long-term distribution model and get their take, that’s a very privileged position to be in,” he said.

He’s been paired with mentors from both the carrier side of the industry and the distribution side. “They are helping me not only by giving me their perspective, but they’re also connecting me to other experts. … What’s great is that over the course of the program, we get to work with mentors who help us refine our business model, refine our pitch, get us to think about the important things,” Aidoud said.

While it’s not the aim of the program, some of the talent attracted by the GIA has remained in Des Moines, Hemesath said.

Including the current cohort, the GIA has fostered 18 companies, Hemesath said. Of the 12 that have completed the platform, “three of those are in Des Moines, and two of those relocated to be here — one from California, and the other one from Germany. Aidoud said InsuranceMenu also plans to establish a presence in Des Moines. At least six other insure tech startups not associated with the GIA are now located in Des Moines, as well.

In addition, eight out of the 12 companies that participated in the GIA over the past two years are making money in the insurance industry or an affiliated industry, and that’s the important thing, Hemesath said.

“We really want them to go off and be successful, wherever home is.”

Related:

• Ideas, Innovation and Mentorship Mix at Global Insurance Accelerator
• Markel, EMC Join Global Insurance Accelerator to Assist Startups
• Grinnell Mutual Leads 2nd Funding Round for Insurance Social Media Start Up

Find Bob | Toronto, Ontario | www.findbob.io

A growth, transition and succession planning tool for financial advisors and insurance agents, utilizing machine learning and elements of gamification for asset protection.

Sentrys | Belgrade, Serbia | www.sentrys.co

A data-protection platform providing data security for consumers, vehicle manufacturers and insurance companies.

MotionsCloud | Munich, Germany | www.motionscloud.com

Mobile and artificial intelligence (AI) solutions for insurers which streamline and automate claims processes to provide a better customer experience and settle claims faster.

RE-Sure | Detroit, Michigan | www.re-sure.com

A blockchain-enabled, app-driven, smart insurance product designed for the on-demand economy.

InsuranceMenu | Boston, Massachusetts | www.insurancemenu.com

A dynamic, data-driven platform geared toward local insurance agents, creating process efficiencies while bringing insurers closer to the customer.

ViewSpection | Tucson, Arizona | www.viewspection.com

A platform providing a transparent, collaborative method for agents and policyholders, as well as underwriting, claims and loss control departments, to share information and maximize service while preventing fraud.