This reminds me of what vineyards did during the prohibition, selling “grape bricks” and explicitly instructing people to NOT dissolve in water and let sit for 21 days or it would turn into wine.
This is also why carriers like agents so much. Agents effectively act as a first screen for carriers that allows carriers to turn away customers in a way that they can't legally do through their policies. Ie "encouraging" agents to send business from certain neighborhoods to other carriers or agents.
This is a discriminatory practice but every carrier does it because it's a way to circumvent the public nature of their filings, and it's another hurdle that startups will need to overcome, particularly if they're doing online distribution where adverse selection is a more pronounced risk.
While much of what Aaron wrote is spot on, one thing missing is the importance of distribution. This a challenge for any startup, but is more pronounced in a regulated industry like insurance with largely homogenized products and with serious restrictions on how you can legally distribute your product (see Zenefits).
If you consider how most people and small businesses buy insurance, they typically make purchasing decisions one a year at most. As such, you need to get in front of them at the exact moment they want to purchase. GEICO and Progressive have done this really well, but have effectively bid up the cost of online advertising to make it prohibitively expensive. This is also why agents are such a powerful force in the industry (and because they effectively provide carriers with an initial underwriting screen which they don't need to file publicly).
It's important to get the product right, and there are many flaws with most P&C insurance today (chief among them that the forms haven't really changed in the past few decades), but I'd encourage any entrepreneurs to make sure they have an answer on distribution before spending time on product.
Disclosure: I've spent a lot of time looking at this as founder of a P&C insurance startup a few years ago.
I work in marketing for a specialty P&C MGA and can attest to distribution challenges, at least compared to other industries, but Zenefits could have (and currently does) operate legally, they just chose not to.
Zenefits was allowing unlicensed agents sell insurance and for those in the company that were licensed, they found a browser hack that allowed them to not sit through the training required by the state (I'm assuming California) to be licensed. In the first case, you should know better but there can be gray areas. In the second case, it's 100% clear they knew they shouldn't be doing it, which makes the first case more likely to have been done knowingly and purposefully.
Yes, having to license people is a pain and presents onboarding and scaling issues, but they could have survived if they didn't "need" to grow at such an insane pace.
Buying insurance today sucks. Customer satisfaction rates in insurance are lowest of any industry except cable. At Bungalow, we’re using data and design to deliver the first great customer experience in insurance.
Come work at Bungalow and help us build a modern alternative to insurance incumbents.
We're hiring a lead backend engineer, a lead frontend engineer, designer(s), growth marketer(s), and customer success representative(s).
We’re still a small team of intellectually curious people trying to make waves in a big industry, so even if you don’t see the position you’re looking for, email us: founders@bungalowinsurance.com. We'd love to talk to you.
Buying insurance today sucks. Customer satisfaction rates in insurance are lowest of any industry except cable. At Bungalow, we’re using data and design to deliver the first great customer experience in insurance.
Come work at Bungalow and help us build a modern alternative to insurance incumbents.
Available positions:
* CTO (drive the technical and strategic direction of the company going forward)
* Designer (design is the most important piece of our company)
* Growth marketer (building a brand in insurance is the toughest marketing challenge in the world)
* Customer service (a focus on customer satisfaction differentiates us from conventional insurance companies)
To apply, please email us at founders@bungalowinsurance.com.
I wouldn't say so. I send my friends money I owe them through Venmo. I make most of my online purchases through PayPal. There's rarely a time where I can substitute one for the other. Although, I don't know the details of the two companies in question.
Fun fact: PayPal owns Venmo. They've tried to keep it quiet because the Venmo brand is much stronger independent from the various screw-ups and annoyances of PayPal.
The big difference: PayPal is for the computer, Venmo is for the smartphone.
That is true, people are generally optimistic about startups but i really do wonder if i have a lack of vision or something, because when i look at this list at exchangel, i see a pile of useless stuff with only 1 or 2 diamonds and 3 or so useful ideas...
I would argue it's not a proper market place, fantasy or not, without such ability. (meaning, whatever values or data that comes from this is of near zero utility without the ability to short)
I'd guess the comment was less about 'what people think is proper,' and more about the fact that there are typically no mechanisms by which to short very early stage private companies.
last time i checked, every single fantasy football site also didn't allow you to borrow money from money sharks to try to bet against on a bad line up.
For anyone interested in homebrewing, I strongly recommend reading Jim Palmer's How To Brew [0]. It's available for free online and does a great job explaining the basics of brewing, while also including details about the chemistry behind what happens during the brewing process. It's much easier to brew an ale than making the lambics described in this article.
Also the book "Yeast: The Practical Guide to Beer Fermentation (Brewing Elements)" provides an excellent guide to using yeast. Describing aspects such as the different flavour components produced by yeasts, up to plating your own yeast samples.
It's amazing how different yeasts can produce radically different flavours. A fun experiment to try is to split the wort (unfermented beer) into different vessels and try different yeasts out. For instance using a hefeweizen yeast, will give clove/banana notes.
A classic for a reason! If anyone is interested in the more complex brewing process and chemistry of lambic beer, Jeff Sparrow's "Wild Brews" is another great read.
In fact, I would expect them to offer own insurance directly in the near future, for several reasons. First, insurance is one of the big practical hurdles facing their self-driving cars – in an accident, who is at fault? By offering their own product they can potentially circumvent this hurdle. Second, if they begin to offer homeowners insurance, they can tie their rates directly to Nest data, which should allow them to offer more competitive rates and more accurate pricing, similar to what Progressive has done with Snapshot [0]. And lastly, this obviously gives Google access to more, and potentially better, personal data.
