In another funding round for a company targeting the insurance industry, San Francisco-based Indio Technologies has raised a $20 million Series B. The round was led by Menlo Ventures, with participation from one of the company’s previous investors, 8VC. Prior to this announcement, Indio most recently raised a $6 million Series A in February 2018. Along with its seed funding, the company has raised $28 million since it was founded in 2016, per Crunchbase.
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According to our own Joanna Glasner, the U.S. insurance and insurtech startup industries have experienced a lot of capital movement over the past couple of years. In 2018, companies in the category raised just over $2.5 billion with startups like Root Insurance, Metromile, Hippo, Lemonade, and others banking investor dollars.
But unlike many of the companies aiming to disrupt the way that insurance itself works— which usually means focusing on taking out the human middleman—Indio is aiming to help those brokers do their jobs better. Self-dubbed a “Turbo Tax-like” solution for insurance agencies, the company has built a client and workflow management software for agents selling property and casualty insurance to businesses.
Co-founder and CEO Mike Furlong told Crunchbase News that he founded Indio after his personal experience as a business owner.
“I had to apply for property and casualty insurance each year, and I did it through a broker,” he said. “It was a nightmare of a process; it took me hours and hours and hundreds of pages of paperwork.”
And that painful process was repeated every year, requiring the owner to fill out new carrier forms, despite the fact that the carrier and questions didn’t change. Furlong emphasized that this is a process every business has to complete, and that 99 percent of property and casualty insurance is purchased through an independent insurance broker.
“There’s 3,000 plus insurance carriers, and there’s 36,000 insurance brokers in the United States. They’re both very, very fragmented, and businesses need a single point of contact to take care of all their insurance needs,” said Furlong.
He launched Indio with Adam Bratt in 2016, aiming to bank in on that market potential by bringing the automation that has transformed other spaces to insurance. With its software, which includes digitized versions of over 6,000 carrier forms, Furlong says that brokers can collect and standardize information needed in the insurance purchasing process through a system that’s easy for clients, too.
The 50 person company currently has 250 clients–insurance agencies– with almost 3000 unique agents within those firms using the system every month. Furlong estimates that the company has processed over 20,000 businesses through the system, or an estimated annual run rate of about $1 billion in premiums.
“[Businesses purchase] about $350 billion in premiums in the United States [each year]. So, you know, we’re still scratching a very small portion of the total premium in the industry,” Furlong said.
The company will be using the funding to build out the next phase of its project: bringing insurance carrier partners on board.
“The client relationship with the broker is half of our vision and our goal,” said Furlong. “The next half is being able to seamlessly transmit the information collected in our system, to the insurance carriers.”
In a startup industry where it seems nearly every company is attempting to change the way that we buy or price insurance, Indio seems to have found a sizable niche where eliminating the middleman isn’t necessarily the best option.
“People aren’t searching to buy business insurance through Google… they’re getting a referral, typically,” Furlong expressed. “I think most digital brokers who have tried to replace the broker have found that they have to compete in the traditional way of boots on the ground, and then the margins don’t really make any sense.”
And in the often complex process of buying insurance, businesses likely appreciate the handholding. Indio’s job is to make sure that brokers can do that more easily.
Illustration Credit: Li-Anne Dias