The on-demand industry is booming as employers are using a distributed workforce that they do not have to provide traditional benefits for. These workers then are responsible for their own insurance needs. It was only a matter of time before a company started providing on demand insurance to on demand workers. The name of that company is Slice Labs. Already helping companies such as Uber and AirBnB, the insuretech startup is poisted for significant growth and eliminating the need for inefficient insurance policies.
AlleyWatch spoke with founder and CEO Tim Attia about the company and the company’s newest round of funding.
Who were your investors and how much did you raise?
Horizons Ventures and XL Innovate were our initial investors, investing $3.9M in our Seed round. Munich Re is also an investor, adding additional money to the seed round on top of the $3.9M. We more than doubled our initial seed with the additional investments, but we are not public about the number.
Tell us about your product or service.
Slice Labs is an insurtech startup providing on-demand insurance to the on-demand economy. Think Uber, Lyft, Airbnb, Homeaway, Instacart, Taskrabbit Thumbtack, etc. We provide insurance that is purchased only when they need it, in line with how they earn their income and with the same ease.
What inspired you to start the company?
My cofounders Stuart Baserman, Ernest Hursh, and I were tired of the broken insurance model. We wanted to create an insurance experience that we would want for ourselves – easy, transparent, intuitive, frictionless, affordable, etc. so we set out to re-imagine insurance. We landed on insurance that is bought for the time one needs it. Starting with the on-demand economy, Slice insurance is sold on a per-use basis for the time an individual is operating as a business, whether a homeshare host, rideshare driver, or the like.
How is it different?
Slice insurance is commercial insurance sold on-demand. It is purchased on a mobile phone with a click and without asking pages of questions we can get answer to ourselves. The insurance can be turned on and off when needed rather than expensive annual policies. No other carrier or company does that. We’re bridging the gap between traditional individual and commercial policies by providing coverage to individuals working (as a business) in the on-demand economy. We also built a proprietary policy that is unique in the market because it bridges personal and commercial lines insurance.
What market you are targeting and how big is it?
Our market, the on-demand economy, is extremely large and growing daily. The McKinsey Global Institute, October 2016 study estimates the part time worker population at 20-30% of the working population that equals $162M workers in the US and 15 EU countries.
What’s your business model?
Our business model is to reinvent and redesign insurance to a frictionless pay-per-use model with incredible coverage. We are a digital insurer and have eliminated most of the costs associated with a traditional insurer.
What’s the most interesting use of the on-demand insurance you’ve seen?
Until Slice, on-demand insurance for the on-demand economy was not available. However, we’ve had companies approach us looking for insurance for sharing economy companies such as, babysitters, caregivers, snow removal services, camera equipment rentals, land sharing, and so on. They have all said they’ve been searching for insurance for their on-demand / sharing company.
Most insurance policies require lengthy forms to complete, require talking to an agent or call center and take weeks to complete.
What was the funding process like?
Our founding team had already worked in successful startups and we’ve built significant experience in the industry. Having investors in the past willing to invest again makes things easier. Initial funding was provided based on the experience and track record of our founding team. This is key in the early stages.
What are the biggest challenges that you faced while raising capital?
Choosing the right investors. Striking the right balance between traditional tech investors and strategic investors. It is also important to manage time wisely as funding efforts can consume a lot of management time that might be better spent executing.
What factors about your business led your investors to write the check?
There is nothing out there like it. We were focused on a new way to do insurance but more importantly on a huge new and underserved market. It’s an important combination.
What are the milestones you plan to achieve in the next six months?
We were the first to launch an on-demand product in the US. The first product launched was our homeshare insurance beta in a few states; we plan to roll out the product across the US. At the same time, we will continue working on our rideshare product. We will also expand on a state-by-state basis. We are currently licensed in 49 states.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
If you have formed your company around a good and strong idea, don’t give up. There are many ways to get funding from crowd-funding to investors. Many successful companies made it bootstrapping their way for a long time. Just don’t get too linear with your vision and goals. You have to be able to be flexible and start proving out your hypothesis. Introduce yourselves to investors and then show progress per your plan.
Where do you see the company going now over the near term?
We just launched our first product – on-demand insurance for homeshare (Airbnb, HomeAway, FlipKey, etc) hosts. The next product will be our rideshare (Uber, Lyft, etc) product.
What’s your favorite restaurant in the city?
That’s a tough one. So many good restaurants. We like many of the inexpensive, but good Korean places on 32nd
