The average cost of an unexpected visit to the vet ranges from $800-$1500 making pet insurance increasingly necessary for pet owners to defray the cost of caring for their furry loved ones. As a result, the pet insurance market is expected to grow to $30B+ by 2030 at a 16.7% CAGR according to Grand View Research. Pawlicy Advisoris a pet insurance marketplace and brokerage that allows pet owners to rapidly make sense of the various pet insurance options available. Pet parents can compare and contrast their insurance options to ensure they are selecting the best coverage with transparency and efficiency in less than 5 minutes. The platform takes a data-driven approach to insurance that places a strong emphasis on understanding breeds and associated health outcomes to tailor recommendations. 68% of households have a pet but only 2% currently have some form of pet coverage, representing an immense opportunity for companies focused on the space. In order to expand its reach to include as many pet owners as quickly as possible, Pawlicy Advisor has recently expanded its offering to focus on partnerships with corporate veterinary groups to introduce pet insurance education.
AlleyWatch caught up with Pawlicy Advisor CEO and Cofounder Woody Mawhinney to learn more about the business, the company’s strategic plans, latest round of funding, and much, much more…
Who were your investors and how much did you raise?
Pawlicy Advisor raised a $12M Series B funding round led by StepStone Group. The round also included participation from Defy Partners, Rho Ignition, Slow Ventures, and ERA’s Remarkable Ventures Fund. This brings the company’s total funds raised to approximately $20M to date.
Tell us about the product or service that Pawlicy Advisor offers.
Pawlicy Advisor is the leading, independent pet insurance marketplace offering personalized comparisons based on breed-specific attributes and total cost predictions for the lifetime of the pet. Pawlicy Advisor’s data-driven model brings transparency and simplicity to shopping across top pet insurance providers. Moreover, Pawlicy Advisor is recommended by the American Animal Hospital Association and used by veterinary practices to streamline and outsource the pet insurance conversation to a licensed third party. Pawlicy Advisor’s team of pet parents and veterinary advisors are dedicated to making it easy and affordable to do the right thing for our animal companions – and have served over three million pet parents to date.
What inspired the start of Pawlicy Advisor?
In 2015, my Shar-Pei puppy, named Wrigley, came down with a genetic disease that required expensive medication to stabilize. As an animal lover and self-described “dog dad,” I was relieved that my insurance covered Wrigley’s monthly prescription costs.
While speaking with other pet owners in my community about this experience, I discovered how lucky I was to have chosen insurance that covered Wrigley’s uncommon condition. Other pet owners shared stories about inadequate and overpriced coverage, and the difficulties they faced evaluating options. Those stories stuck with me through business school, where I spoke with hundreds more pet owners and veterinarians around the country about how the pet insurance experience could be improved. In April of 2018, I decided to launch Pawlicy Advisor.
Around the same time, Travis Bloom bought pet insurance after adopting his first pet, a cat named Ginny. Frustrated with the buying experience and wishing for a more transparent process, he reached out to me after reading about the business idea. Three months, countless coffee chats, and a nine-hour hike later, Travis joined as CTO to help pet owners everywhere find the right insurance at the right price.
How is Pawlicy Advisor different?
To date, most pet insurance resources have treated carrier comparisons superficially. Not all pet owners are alike and not all pets are alike: some may need minimal coverage while others may need broader and more immediate coverage for conditions such as knee injuries,, dental issues, and prescription foods. The “best pet insurance” is different for everybody.
Whereas other pet insurance resources do not offer licensed support agents—unaffiliated with any one carrier—to help clients navigate their pet insurance options and do not offer breed-specific educational information, Pawlicy Advisor built its platform with licensed support, personalization, education, trust, and user experience in mind: Pawlicy Advisor evaluates insurance options by (a) how coverages apply to consumers’ pet breed-specific health risks and (2) by how policy pricing fluctuates over the lifetime of consumers’ pets’ typical lifespans. These are very different analyses for French Bulldogs and Great Danes, for example, which have astonishingly different health needs and lifespans.
There are over 500 pet breeds in the U.S., and each is unique and deserving of a personalized journey through Pawlicy Advisor. Since pet insurance increases in price every year—more than other Property & Casualty insurance lines—evaluating cost over a pet’s typical lifespan is hugely valuable to pet owners, saving clients up to 83% in insurance costs.
There are over 500 pet breeds in the U.S., and each is unique and deserving of a personalized journey through Pawlicy Advisor. Since pet insurance increases in price every year—more than other Property & Casualty insurance lines—evaluating cost over a pet’s typical lifespan is hugely valuable to pet owners, saving clients up to 83% in insurance costs.
As a licensed insurance brokerage, Pawlicy Advisor is 100% free to use with NO hidden fees for veterinarians and pet owners because it receives standardized fees from its insurance partners that are only paid if pet owners find great policies and hold onto them over time. This means Pawlicy Advisor is incentivized to make insurance recommendations based on which option will provide the best coverage and lifetime value for the pet owner.
Pawlicy Advisor is viewed by consumers and veterinarians as the most trusted pet insurance resource in the U.S.
What market does Pawlicy Advisor target and how big is it?
The North American pet insurance market—the most direct market in which Pawlicy Advisor is operating—is >$3B. We view Pawlicy Advisor as the conduit through which this market grows over 5x, in line with more mature pet insurance markets in other global regions.
What’s your business model?
As a licensed insurance brokerage, Pawlicy Advisor is 100% free to use with NO hidden fees for veterinarians and pet owners because it receives standardized fees from its insurance partners that are only paid if pet owners find great policies and hold onto them over time. This means Pawlicy Advisor is incentivized to make insurance recommendations based on which option will provide the best coverage and lifetime value for the pet owner.
What are your post-COVID office plans??
We shifted to a remote culture during the pandemic, downsized our office, and now have employees across the U.S. We will continue to hire the best-fit, rockstar talent wherever they may be in the country.
What was the funding process like?
We were fortunate to build a relationship with our lead investor this round, StepStone, over two years, connecting every quarter or two to discuss the company’s progress and vision. As soon as we felt like we had an extremely compelling case for use of new proceeds to scale the company’s operations and distribution, our conversations with StepStone quickly evolved into what a round would encompass. We felt confident working with StepStone because, from the outset, we had mutual respect, trust, and significant alignment on Pawlicy Advisor’s roadmap and opportunity.
What are the biggest challenges that you faced while raising capital?
The decline of public market valuations, inflationary pressures, and weakening consumer confidence were daunting, yet the pet care market is generally seen as recession-resistant and our business has withstood these macroeconomic headwinds well so far. We are thankful we managed the business efficiently since its earliest days (we were a team of three at our Series A and a team of 12 at our Series B) so when it came time to raise capital, we were in a healthy position in terms of cash on hand, strength of company metrics and scaling opportunity, and valuation.
What factors about your business led your investors to write the check?
“Pawlicy Advisor is demonstrating that it can be a market leader, with a nationally recognizable brand and unique distribution channels,” said Seyonne Kang, Partner at StepStone Group. “We believe Pawlicy Advisor is well-positioned to become the leading authority on pet insurance, and we look forward to working with the management team as they further innovate and grow the firm’s position in the industry.”
What are the milestones you plan to achieve in the next six months?
We will be doubling our team size and making key hires across departments to allow us to build new partnerships, grow our veterinary resources, and scale distribution. We are working as fast as we can to onboard a queue of pet insurance providers and integrate them with the Pawlicy Advisor comparison shopping platform. Additionally, we will be teaming up with more veterinary corporate groups to streamline the modernization of pet insurance education within veterinary practices across the country.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Besides the common Tweets of “extend runway,” “decrease payback period,” and “manage valuation expectations,” I would focus additional time investing in your team because a strong team culture will make your business resilient, productive, and fun. It’s easy to focus on business strategy, product roadmaps, budgets, and contingency planning and lose sight of the community that makes this experience fulfilling and productive.
Besides the common Tweets of “extend runway,” “decrease payback period,” and “manage valuation expectations,” I would focus additional time investing in your team because a strong team culture will make your business resilient, productive, and fun. It’s easy to focus on business strategy, product roadmaps, budgets, and contingency planning and lose sight of the community that makes this experience fulfilling and productive.
Where do you see the company going now over the near term?
Pawlicy Advisor is on track to be the authority on pet insurance for both consumers and veterinary teams. As more providers enter the space, our offering becomes even more attractive, and, with inflation rising, veterinary practices will lean on Pawlicy Advisor to help more clients be able to afford critical pet care.
What’s your favorite outdoor dining restaurant in NYC?
Dirt Candy.
