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Start up your insurance business the lean startup way Mateusz Maj Brussels, 12/12/2017
Actuary +7 yrs experience working for insurers
Researcher PhD in Math & Economics
Entrepreneur insurtech & mobility startups since 2013
About Mat
Insurance is the main way for businesses and individuals to reduce the financial impact of a risk occurring.
Insurance companies sell protection against risk and cultivate risk-averse culture that reduces incentives to take additional risks and to innovate.
What is insurance?
Traditional insurance is broken
Commoditization No Trust No Engagement
Insurtech on the rise Products
UBI – IoT - Drones
Processes AI – SaaS – Blockchain - Mobile
Data IoT – Predecitive - AI
Touchpoints Social – Mobile - Shared
Startups
A startup is a temporary institution designed to create a new product or
service under conditions of extreme uncertainty.
What is a startup?
Startup =
Experiment
What is a startup?
Source:www.cbinsights.com/blog/startup-failure-post-mortem
The Lean Startup is a method for creating and sustaining innovation
in all kinds of organizations.
The lean startup – a scientific approach
There are three areas in which a startup typically faces a very high degree of uncertainty
Product Risk
Customer Risk
Business Model Risk
Can we build this thing at all?
If we build this thing, will people use or buy it?
Can we create a way for this thing to make us money?
Main risks
Validated learning
The lean pyramid Product
Strategy
Vision
What?
How?
Why?
The lean pyramid – why?
Source: Running Lean, Ash Maurya
Qualitative: Why do you exist? Quantitative: How will you measure this impact over 3 years
The lean pyramid – how?
Source: Running Lean, Ash Maurya
Build roadmap Scale in stages every 3 months
The lean pyramid – test
Source: Running Lean, Ash Maurya
“If it disagrees with experiment, it’s wrong.” Richard Feynman
Test with 3-week lean sprint iterations
Source: Running Lean, Ash Maurya
Build – Measure - Learn
Only 48 sprints
to go!
MVP
The smallest thing you can build that lets you quickly make it around the
build/measure/learn loop
MVP ≠ Beta
At every release the user gets something she cannot test, until the last release when they get something they can use.
This is not MVP
Illustration by Henrik Kniberg
Users get something at every release that they can test and use
Real MVP
Illustration by Henrik Kniberg
MVP – B2B2C SaaS
1 Experiment
- Interviews – B2B - Interviews & user surveys – B2C - Market analysis – B2B & B2C
Community-driven approach in collaboration with Mobile Vikings
MVP – B2B2C SaaS
2 Offer
- Slide Deck – B2B - Landing Page – B2C
MVP – B2B2C SaaS
3 1st MVP
- Clickable mockups – B2C - B2B partnership program – B2B
MVP – B2B2C SaaS
4 Product Development
- User flows - Feature prioritization - Usability testing
MVP – B2B2C SaaS 5 Full launch
In collaboration of Mobile Vikings, KBC, Vlaamse Overheid
Big PR success – our app was covered in every major news program in Flanders – radio & TV + 2000 registered users in first 12 hours
Funding from iMinds, ESA, H2020, IWT
MVP – Hardware startup
A very high-end type of MVP. But it worked!
MVP – Hardware startup
Hardware products usually have 2 MVPs:
• A prototype built to validate the technology
• A video campaign used to validate the market
A Minimum Viable Product is not a Product, it's a Process
Tools
Lean Canvas
It’s an actionable and entrepreneur-focused business plan that helps
you deconstruct your idea into its 9 key assumptions.
Lean Canvas Project Name 12/12/2017 Iteration #x
Cost Structure Customer Acquisition costs Distribution costs Hosting People, etc.
Revenue Streams Revenue Model Life Time Value Revenue Gross Margin
Problem Top 3 problems
Solution Top 3 features
Key Metrics Key activities you measure
Unique Value Proposition Single, clear, compelling message that states why you are different and worth paying attention
Unfair Advantage Can’t be easily copied or bought
Channels Path to customers
Customer Segments Target customers
PRODUCT MARKET
Case Study: Metromile
Pay-per mile insurance for low mileage drivers
1. Customer segment
1) Low-mileage urban drivers
2) Sharing-economy drivers e.g. car-sharing, car pooling, Uber
2. Problem
1) Too high car insurance premiums for low-mileage, urban drivers
2) No insurance coverage for on-demand car services
3. Unique Value Proposition 1. The only real Usage-Based Insurance
– pay per mile 2. The only personalized insurance for urban
drivers and millenials who use car less regular and less frequent
3. Metromile app with superior user/customer experience
4. Solution
Pay-per-mile car insurance and a smart driving app that monitors driving behaviour and vehicle safety aims to make
car ownership less expensive, more convenient, and as simple as it can be.
5. Channels
1. Website 2. Appstore/Playstore 3. Agents 4. Social Media
6. Revenue streams
Pey-per mile is a type of usage-based insurance, where users pay a base rate along with a fixed rate per mile. Base rate ($30.00) + per-mile rate (3.20 ¢)
7. Cost Structure
1. Cloud system 2. Software development 3. Wireless technology (OBD box) 4. Operations & Maintenance 5. Other (Offices, Staff, Help center, Legal, …)
8. Key Metrics
1. Customer acquisition cost 2. Customer retention 3. Insurance metrics – Loss ratio , combined
ratio 4. Viral reach
9. Unfair Advantage
1. Collaboration with Uber 2. $191.5 million in funding from
top funds
Game
The lean startup in a corporate world 1. Build a risk-taking culture 2. Willingness to really change 3. Eco-system thinking 4. Lean is a mindset not just a process 5. Implementation at all levels,
especially management
mat@vivadrive.io
Mateusz Maj
Let’s innovate together
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