FSI Member Spotlight, Episode #4: Where Corporations are Focusing Investments in 2020
For our fourth episode of FSI Spotlights, Praxent Senior Director of Innovation, Lance Vaughn, met with an FSI member who is the true definition of multi-hyphenate, Sabine VanderLinden. Sabine is Co-Founder, CEO, and Managing Partner of Alchemy Crew, a venture validation studio for the financial services and insurance sectors. She also serves as Director of the Proposition Circle, Board Member for a number of groups of businesses, and Investment Advisor for Redsand Ventures and Mandalore Partners. Previously, Sabine co-founded Startupbootcamp Insurtech, where she currently serves as an Early Stage Investor. Sabine is also Co-Editor of bestseller, The INSURTECH Book.
Sabine and Lance shed light on some of the difficult choices faced as an Early Stage Investor. When less than 1% — or 70 out of 15,000 ventures — are selected, decision making relies on some key criteria Sabine’s identified over the course of her career. First, do the founders have great passion and a drive to make an impact on the world — and can they actually execute on that passion? Sabine has found the ventures that close shop are typically those who give her a ‘jellyfish story’ — throwing what they believe the investor wants to hear and just hoping it sticks to the wall like a jellyfish. Successful ventures build up from a foundation rooted in the customer’s needs. Further, is a deep customer focus coupled with a mastery of technologies like blockchain or AI towards offering targeted solutions to their problems? Part of this is ensuring that B2B ventures offer real solutions for other B’s. With Sabine’s focus on B2B ventures, it’s imperative that globally recognized insurers actually see the value in what those startup organizations have to offer. Finally, revenue. Does the venture have a firm grasp on their financial strategy, a clear vision for the runway that investment creates?
All of this being said, Sabine is careful to emphasize that not every investment fits in an easily defined box — particularly with the economic challenges of the pandemic, flexibility and nuance is required. Speaking to the challenges of the pandemic, Sabine has seen strong numbers in insurtech investments through 2020. 1,500 ventures have received 41 Billion in investment between 2015-2020, with 5 Billion of that occurring during 2020, to date. Sabine’s prediction? 2021 will show that final number coming closer to 6.1 billion in insurtech investments. While this is about 2 Billion lower than 2019’s total, Sabine still sees investors taking plenty of calculated risks — honing in on the greatest opportunities and investing more in major players like Series B, C, and D ventures with proven, reliable business models.
Sabine firmly believes that strong investments — now and in the future — will be highly responsive, prioritizing people, planet, and society. As a related aside, at least 40,000 ventures have pivoted their propositions to focus on COVID-19 related needs. Finally, speaking to trends in corporate investments, Sabine sees strong interest in operational resilience solutions, digitization of insurance sales, cyber security and risk prevention, as well as a need for AI assisted and other virtualized experiences that effectively serve customers and buyers.
- Founders must demonstrate to potential investors that their solutions are based in service-driven passion — and that their solutions are executable.
- 2020 has seen a decrease in insurtech investments compared with 2019. Investors are seeking out Series B,C, and D ventures with proven markets and reliable business models.
- Sabine predicts an increasing emphasis on ventures that prioritize people, planet, and society — while operational resilience solutions remain highly attractive and on-trend investments for insurance corporations today.
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