Insurance Edge wanted to catch up with Percayso Inform after their recent Seedrs fundraising round. It’s a finance route that many brokers and insurtechs consider when looking to expand, so what are the benefits and what lessons can be learned along the way?
IE spoke to Percayso Inform MD Richard Tomlinson to find out more.
IE; Rich, what were the primary reasons for going to the Seedrs platform?
RT; First, it’s a good alternative to approaching a bank but I think it also works very well for insurtechs or tech companies in general. You’re reaching an audience that wants to invest in something new and often they are very interested in what you are doing as a company too. You need to be ready with answers because there will be questions.
IE; Some smaller SMEs might be concerned that the pitching process can take up a great deal of time, how did you find things for Percayso?
RT; There is an impression that getting a nice presentation video together, maybe engaging by email or forums with potential investors might eat up lots of time. But I would say that it never really got beyond 10-15% of my time during the process, which took place in March this year.
Regardless of the company size, it’s good for a founder and CEO, at the very least, to get involved with it, really be hands-on. I guess bigger companies could appoint a kind of Project Manager to bring everything together but there’s no substitute for having the founder describe what fired them up, how the company has expanded, new products etc.
It is essential, to prepare, especially when it comes to putting together your video because it needs to showcase your company journey to date, have some strong factual info in there too. Then be as ready as you can to answer questions, which are often quite detailed.
IE; What kind of prep time did you devote to the Seedrs pitch in advance?
RT;. It’s crucial that your slide deck is accurate, doesn’t waste time and tells everyone the essential data in one smooth process. Rehearsals were useful for us, especially for the video clips. You can’t do enough of that in advance. The other thing worth doing is that a couple of weeks before the launch everyone you know professionally, plus friends too, should know about the pitch and have the chance to share the video too. You want to build up a bit of a buzz in advance.
IE; How valuable was it to share via social channels like Twitter and LinkedIn?
RT; It was important for spreading the word, but not the main driver of funding. I would estimate that social channels brought us about 25% of the overall investor pool. You also need to do a little bit of vetting on social media as it’s possible to overshare sensitive company info when people are asking about profits so far, new products in the pipeline etc.
SHOW ME THE MONEY
IE; So it was successful, target was exceeded, how many investors did you get in the end?
RT; We signed up about 250 investors and they put in anything from £50 upwards. The great thing about the investors is that so many of them are advocates for Percayso Inform now, they have invested their emotions as well as their money. It’s worth remembering that there is a PR benefit from all of this too, because your investors will often share the good news, share their belief in your company’s expansion.
IE; Sounds like that investor passion is something that lifts the company too, as people are kind of investing in a cause to an extent?
RT; You see that more with companies that are using Seedrs to fund eco-friendly products or services definitely. But yes, people are buying into your company’s new way of doing things, they are joining a movement to a degree.
IE; Do you think Seedrs taps into a different investor market from the stock exchange, ISAs or property etc?
RT; Yes, there are people who know a bit about insurtech but maybe not enough to take the plunge on the London Stock Exchange perhaps. The great thing is that you can have a conversation with potential investors through the Seedrs platform. The investor is happier because they have that more personal contact, but it’s still a platform acting as a go-between. There is still that distance and some people like that approach.
There is a feeling that Seedrs are bringing some interesting Fintech and Insurtech companies to the platform and they are very good at keeping in touch with investors while the round is taking place. Those updates are useful for the company because it isn’t you doing the emailing, it’s the platform that they have signed up to. As the deadline gets nearer that can really help your company, because you can share the news on targets being met, exceeded and so on.
FREEDOM TO CHASE OPPORTUNITIES
IE; Are you looking at international expansion after the fundraising success?
RT; We are already on that road, yes. We have boots on the ground in Australia and that gives us a base to expand our services in that region. Not just NZ, but also Singapore, Japan, Taiwan, Indonesia, which are all centres of innovation and where people are used to sharing their data..
Exciting to see so much potential over there and while we don’t want to get too distracted at this stage with international opportunities, as we have the privilege of winning investor trust then we have the responsibility to deliver on our promise and grow the Percayso brand both in the UK and further afield.
IE; Is that freedom to pursue opportunities one of the biggest benefits of using Seedrs?
RT; Yes it is. Obviously you need a good plan to chase those opportunities, it has to be a measured investment, but having the resources in place to make stuff happen is what Seedrs is all about. You gain a momentum from a Seedrs pitch process, you really feel that people are backing your company and believe in what you’re doing. People see your posts on LinkedIn and get in touch to wish you luck and so on – all that is a great bonus, it makes you feel that you’re on the right track.
IE; Overall it sounds like a very positive process, not as scary as pitching to a Dragon’s Den panel.
RT; It is a great experience to go through and I’d recommend anyone to do it. There is a side benefit too, in that you kind of audit your company before the pitch, sort of stress test it. That sharpens your game immensely and you learn to make small adjustments here and there before pitching. You want to look your best, yet still be transparent for potential investors and for any insurtech – for any company – that is a sweet spot to be in.
I would be happy to chat to anyone else in the insurance sector and share our experience of our Seedrs round as well, anytime.
IE; Rich, thanks for your time and good luck for the future.