Tell us about yourself and how you get to do what you do today.
The first thing is to just do it, and that’s the most important thing—not just talk about it but do it. Also, having grown up in Berlin, I’ve always been close to the startup ecosystem and have always been attracted by it.
I was previously working in London as an investment banker and was thinking about the next steps in my career, having seen most of the industry. Ultimately, I decided to go down the entrepreneurial path.
I was also lucky enough to know Julian Teicke, one of my co-founders who is also from Berlin. We have a friendship dating back about 20 years. He gave me a call one day and said that he has this amazing new plan in insurance.
After looking into it, I decided to jump ship, left everything I had in London and moved to Zurich. That’s basically how it all started.
Can you take us back to your founding days?
In the very beginning, by chance, Julian was living in a shared flat. One of the guys was a Bain consultant who was sent off to a project somewhere far away, and I was able to move into the same apartment.
At that time, he was still working in his previous company from 6:00 AM to 6:00 PM, and then he worked from 6:00 PM until 12:00 AM together with me on wefox. Basically, my workday was waking up, taking a shower, and going to the living room.
From there, we tried to convince the best possible people to join us. I remember conversations with Googlers at the time to convince them to move from Ireland to Zurich. We didn’t have an office and had to hold interviews in this apartment.
It’s always a little bit weird if you ask them to come to your house for an interview, but it allowed us to start off well and not spend too much money in the beginning.
What’s the problem that you’re trying to solve?
wefox is a digital insurance company that uses technology to bring a new level of customer centricity. By now, everything in today’s world is near real-time. If you buy something online, if you order a cab or food, the expectation of customers is just a very different one. Insurance hasn’t been customer-centric at all until recently.
We are looking to bring insurance from a paper-based product into a truly customer-centric product through the unique approach by focusing on tech-enabling the human being and automating as much as we can in the back office. People have always told us that human insurance agents are basically dead, but in our opinion they’re more alive than ever.
We’ve been able to grow extremely fast. We are on track to grow to more than $350 million USD in revenues this year while and to already hit profitability from next year onwards.
How does that work from a customer journey perspective?
Our target customers are basically everyone who is above 18 that’s looking for insurance, with the oldest being 80. We’ve been focusing on bringing convenience to the customers by allowing the customer to choose how they want to be advised when it comes to complex insurance products.
They can choose to speak to our advisors through a video conference, phone call, or other methods. This allows them to get the required advice to choose the right insurance solution digitally. You can see your policies on the app, edit it, raise a claim directly, and get real-time claims payouts. We as an insurance company are here for you 24/7, 365.
And you cut through the paperwork, right?
We’re providing a much better customer experience across the entire journey of purchasing insurance—starting from getting a quote, taking out a policy, and raising a claim. We also provide a much better experience for our advisor and broker base, so that for them, it’s also much easier to sell a wefox insurance product.
For example, it is normal in car insurance to ask 30 questions, but for our products there may be just 5 questions. We’re getting data from all kinds of different places and there’s no need to ask the customer, making it as convenient as possible. This allowed us to bring on a great group of customers, for us to grow much faster than the competition and at a much better cost ratio compared to the overall market.
We had the opportunity to start from scratch and used technology at every single point across all the processes. Today, around 80% of all our processes are automated, as compared to incumbents who only have 10-15% of their processes automated. For them, it’s extremely difficult to move by even a fraction of a percentage point.
What are your product verticals like?
Currently as our own carrier, we’re selling car insurance, private liability insurance, household, and pet insurance, and we are constantly extending the offering of our own products. We’re also selling life and health products of third-party carriers (e.g., Allianz, Zurich insurance, etc.), to get the best possible product to our customer base.
How do you make your money? What are your thoughts on unit economics and scale?
We generate revenues through two ways. On the one hand we generate commissions from selling third-party insurance products; on the other hand, we sell our own products and receive the premiums directly.
By using data, we can also curate and offer products that are cheaper to customers while still making a higher margin. We do this by understanding the risk of certain customers. If the customer is less risky, we can offer them a lower price.
This has allowed us to have a superior unit economics and managed to show profitability for the first time in 2020. Don’t forget, we’re growing this year from around $140 million to $350 million in revenues and are on track to have the entire group to be profitable from next year onwards.
Which country are you based in currently and which markets do you want to get to?
Our official headquarters is still in beautiful Zurich. We have offices in several different locations and have a significant number of people based out of Berlin and Barcelona.
We currently operate across Germany, Switzerland, Austria, Poland, and are just about to launch in Italy. Our approach is that we’re here to solve a global problem and expand across Europe, not just where we are currently operating in. In the coming months and years, we will look into going global.
What would be a critical piece of advice you would give your younger self?
I think the most important thing is to know that everything will be okay in the end. And if it’s not okay, it’s not the end. In my opinion, running a startup is a lot about dedication, persistence, and the ups and downs that you have along the way.
It’s great to have big events, like a big fundraise and have a great reception from it. To get to this point, it took a lot of hard work and sweat. Always when I see people who previously worked with us and now started their own companies, I think that’s great because starting a company is a major personal growth journey independent of what the outcome is. That’s why I always recommend doing it.
I think the most important thing is just to know that no matter how hard the moments are, there’s always a solution and you must be persistent, and you will make it happen.
Do you have a book or a movie or documentary that you could recommend to aspiring entrepreneurs?
One book that I read which connects a little bit of work and what I do outside is a book called “The Inner Game of Tennis”. It talks about what’s required in tennis to succeed, such as the mental strength that is required to excel.
There are a lot of amazing players out there with great technique that play amazingly, and you either win or lose at the end of the game when the competition is tight. That’s very much driven by your own head and developing a very good mental strength.
How many hours do you work a day and what do you do to relax after work?
You always need to work smart and try to work as efficiently as possible. Ultimately, it shouldn’t be about the number of hours that you work, but how smart you work. Obviously during tough times, you must work much more, but you also have to find ways to get out and relax a little bit.
One way I relax is by playing tennis. It allows me to, within a very short period, be in a different world, to concentrate on something completely different. You may also get a couple of new thoughts into your mind that allow you to think about something differently. When you come back the next day, you come back with a lot more energy.
You just raised a few million recently. What are the next milestones that you want to hit?
We’re still in the very beginning, as we operate in a $5.2 trillion market. There’s still so much opportunity and are currently representing just a fraction of that total market.
We want to double down on our models that we’ve been proven until today, and extend our reach into additional European markets, the U.S. and Asia, hopefully creating as many happy customers as we can.
Anything else to add?
For the people that haven’t seen our commercials, in Switzerland, we’re currently doing a couple of humorous videos with a different approach towards insurance. We wanted to bring across the idea that you can live your life and do what you enjoy. And, even if something bad happens, you don’t need to worry about it because we are here for you.
This describes a little bit about the kind of people that we’re looking for, who are competent and extremely motivated to reinvent insurance together with us, while also enjoying the process and having fun. I think this combination really makes a great team.