So…you want to launch an insurtech

The insurance industry has seen a multitude of insurtech startups over the last two decades and with the advent of AI, the number continues to grow. For the startup, there is an expectation that the company and its product will change an important aspect of the industry, solve a particular pain point, and capture the attention of carriers and investors who will line up to purchase their invention.

Sometime this happens, but more frequently, the process takes significantly longer than the founders expected, or they encounter challenges they never anticipated. Tim Hardcastle, CEO of INSTANDA, understands all of these issues and shares some of his hard-earned wisdom in the Dig-In podcast, Secrets to launching a successful insurtech.

He started the company in 2015 and shares, "There was a lot of hype, and this is similar to what we're seeing now, a lot of expectation around how these insurtechs were going to change the industry. And then, we've gone through a period of where maybe that hype has calmed down a little bit."

For all of the excitement that comes with a launch, Hardcastle says, "the interesting thing is we've gone through this wave of hype, the disappointment, and then a normalization. And that's a pattern that applies, I think, to most technology-driven waves of change. And again, we're seeing that with AI in real time as well."

One of the early challenges involved market adoption. While the industry realized INSTANDA's product was unique and "very cool," the adoption from both carriers and MGAs was slower than they expected and took more money than anticipated. "The impetus was there from day one, and I'm happy to say it's never changed," he says, "but the reality is it takes a long while for the industry to adopt new ideas, particularly when they're radically different, which is what ours was."

Hardcastle lays out the building blocks and processes involved in creating, launching and growing a new insurtech. Aspects like funding, hiring staff and establishing a company culture all play key roles in a company's growth. He is also honest about some of the mistakes they made early in their process and what he'd change if he could go back in time to redo some things.

The good news, however, is that he believes they made wise decisions for the most part that have helped the company to thrive over the last decade. "I believe there are particular things that determine how successful a business is going to be. That does come back to the ability of the founder to maintain and espouse, as you say, what the business stands for, why it's happening, but through their behavior, to be a role model…"

The full podcast can be found here.