Lessons learned from the accelerator
Tips for startups in the insurance industry
As head of the Global Insurance Accelerator in Des Moines, Brian Hemesath fosters connections between technology startups from around the world that have great ideas for insurance applications with industry mentors interested in partnering with them to bring those ideas to the market.
Launched last year, the accelerator is sponsored by seven Iowa insurance companies, which have renewed their sponsorship commitments. Last year, the accelerator hosted six startup technology companies and on Feb. 9 began its second 100-day session with a new group of startups, which will receive mentorship and assistance in developing their products.
During a recent presentation at an insurance industry innovation symposium in Silicon Valley, Hemesath presented his top tips for entrepreneurs in dealing with insurance carriers, as well as the most important tips for carriers in dealing with startup companies. We sat down with Hemesath to talk about some of the lessons he learned from the first year of the accelerator as well as a look ahead at this coming year’s class.
Hemeseth summarizes his presentation in a video here.
What’s the biggest tip you have for startups you work with?
The biggest one is to learn to listen. Many times, your customer is telling you exactly what you need to know. They don’t want to be sold anything; they want to tell you what they want. Just learning to be a good listener. … That was true for me even when I was running Diligent Information Services LLC. Mike Wagner of White Rabbit Group paid me a great compliment early on. He said, “You know what makes you different is you know how to listen.” I had never really thought about that before, but it’s the most important part … being able to listen to what they want and need.
How hard is it for startups to hear that advice?
It’s really hard for them, in part because they’re so excited to talk about what they’re doing. … One of the things that makes the accelerator so powerful is the back-channel feedback. I’ll get feedback from both sides; the ability to close that loop back to the startup is really, really powerful. The ability to get the truth (from the carrier) about how the meeting actually went and to convey that back to the entrepreneur is priceless.
What key advice do you have for insurers in dealing with startups?
A trend that we see on the insurance side is (the companies) setting up innovation centers or “labs.” They are intentionally set up to be listening posts to look for startups that are doing great things. That’s a step in the right direction. But the next step is that listening post needs to connect to the business (that hosts it), and it needs to connect to the business in a way that prepares the business for the reality of what these startups are. They (the startup principals) are not only the CEO but the janitor. They do everything in between, and it’s a roller coaster of emotions. So these listening posts understand the startup world, but they need to communicate back to the business. Otherwise, when the business sends the startup its 18-page document about “how to do business with us,” they’re going to freak out. Those are the kinds of things the listening post needs to understand better and communicate.
Have you put these tips into any formal training to inform startups or their mentors?
We did mentor training last year, and we’ll do it again this year. Additionally, the “first day of school” for the startups, we do a whole orientation, and the lessons learned will also be incorporated. For example, one of the subjects is good email etiquette. It’s surprising how many (startups) don’t know how to do a formal email introduction. Or when to blind carbon copy someone, and then when to pull them out of that thread. Everyone’s been stuck in the email thread where 18 emails later you’re still getting updates about someone trying to schedule a meeting.
How productive has your “off-season” been prior to your next class?
Time is actually on my side. Last year, we didn’t have a lot of time; I came on, full time, 60 days before the class started last year. We literally built the plane while it was flying; this year we actually had time to build a runway. I can say there will be tighter integration with the Global Insurance Symposium (that will be held again in April). That will be a good move.
I’m trying to take lessons learned and apply them, but not make assumptions that we know how all of this will work. There is still a lot that we need to learn about our processes, and what makes the mentors get engaged with the startups. For example, the stage of the startups that are applying for year two are farther along (in their life cycle) than in year one. We have attracted much later-stage startups, and that will be reflected in the class because they’ll be coming with finished products, and some with revenue and customers. So that will present a whole new set of challenges, because that’s a different startup to mentor.
Why would you say that has happened?
It’s awareness. I did a number of speaking engagements; in fact I had six trips over 12 weeks, all related to the accelerator. That
introduced us to startups at a later stage that attend these types of conferences. That’s something we’re going to learn this year, how that works out. In this second cohort, I think there will be an equal number of lessons learned.
Tips for startups working with enterprises:
- Shut up and listen. The ability to listen to your clients’ needs and what they’re trying to accomplish is key to your success.
- Find mentors: Find a key industry mentor to open doors, push you through and make connections.
- Understand the big picture: Realize that your product or service is probably a cog in a bigger wheel. Be able to speak the language of the other moving parts.
- Understand the complex sale: Your message should change at every level of the sale, and it’s critical to understand at what level of the sale you should come in.
Tips for enterprises working with startups:
- Drop your “Iowa nice”: When a startup pitches a product, explain to them candidly what they need to fix and provide critical feedback.
- Do more, talk less: At some point, the conversation needs to move to action. If you’re not interested in engaging with a startup, tell them that early in the process.
- Connect your listening post: Access to data and people are critical to success. Ensure that if you have a listening post, that it’s connected to the enterprise. Have a data distribution strategy for sharing with startups.