Home - Fintech Horizons Media 0
Fintech Horizons Media

Sign up for the Free Beta

A Publication of Fintech Horizons Media


Fintech Horizons was founded by veteran journalists. We cover startups in insurtech, payments, alternative lending, capital markets and blockchain/distributed ledger. Our articles highlight company technology, people, competition, and fundraising, while also looking at how a company was founded.

Featured Content

Featured Article

Praedicat could raise capital if new product directions gain traction, CEO says
28 Aug 19 Tags: capital raise Data Insurtech City: Los Angeles State: California Region: SoCal Open: PDF

By: Kevin Nafziger

Preadicat, a company that develops liability risk management modeling tools for insurers, reinsurers, and businesses, could raise capital if either of two new product directions gains traction, CEO and founder Dr. Robert Reville told this news service.

The company, which is headquartered in the greater Los Angeles area, examines trends in peer-reviewed science to predict liability exposure from emerging risk. 

Praedicat raised its most recent funding about a year and a half ago, Reville said. In February 2018, Praedicat raised $6m as part of an AA round. It previously raised $4m in venture capital in August 2013. It also received some initial startup capital from Risk Management Systems and the RAND Corporation in 2012 when it was spun out from RAND, a non-profit think tank, according to the company.

Praedicat’s offerings for modeling liability risk are performing nicely and the company has no current plans to raise funding for that area, the CEO said. The company has three main commercial products in liability modeling--CoMeta, a modeling tool for underwriters, Oortfolio, a portfolio modeling tool, and Chemata, a tool used by businesses to measure liability risk according to its website.

Praedicat is also working with insurers and reinsurers to jointly develop liability risk products. Building such joint product offerings is one of Praedicat’s top priorities for the remainder of 2019. Towards this end, the company is participating in September in Lloyd’s Labs Cohort 3 accelerator program in London, Reville noted. To create just five joint products in emerging liability risk would go a long way to close gaps that exist in coverage, the CEO said.

A second potential product direction would be a risk insight offering for the global industrials market, the CEO said.

While both initiatives are important, Reville sees his top priority as CEO to be nurturing the company’s culture of cross-disciplinary collaboration. Praedicat has assembled a fascinating group of bioscientists, economists, modelers, environmental engineers, and other specialists. The company’s culture is one that fosters open scientific collaboration, and is its key strength, he said

Reville said one of his biggest concerns for the insurance industry is that excluding most types of emerging risk is now the norm, a practice that ultimately makes insurance less relevant and leaves a lot of risk on the table. In 1973, the year the EPA banned most asbestos products, insurers covered 94% of torts. By 2012, that percentage fell to 55%. Fear of the next asbestos has been the reason insurers routinely write policies that include 25 or more exclusions for emerging risks, Reville said. 

A better path than excluding all emerging risk is to learn lessons from how the industry adapted to hurricane risk following Hurricane Andrew. In 1993, damage from Andrew forced many insurers into bankruptcy. The industry though started taking steps to prepare itself for future hurricanes, by using catastrophe(CAT) modeling to measure exposure, a tool that was still new and not in widespread use before Andrew. In 2001, the insurance-linked securities (ILS) market also exploded, providing an additional way for insurers to protect against catastrophic loss, one that also was appealing to investors because returns were not correlated with the economy, Reville noted.

In 2005, when Hurricane Katrina hit, a hurricane that was much larger and more destructive than Andrew, not a single insurer went bankrupt, he noted.

Indeed, Reville said he considers Risk Management Solutions (RMS), a Praedicat investor and a leader in the CAT modeling field, to be the “original insurtech.” While there is important innovation occurring from startups in a variety of areas including process improvement and customer engagement, the most valuable work is potentially from insurtechs that either directly reduce overall risk or that help grow the amount of premium insurers write, by providing insurers the ability to accurately assess future risks, he said.

Praedicat has been out in front of a number of key liability risks that now are in the public eye, including health risks from baby powder and glyphosate. Glyphosate is a primary ingredient in Roundup, but also in 800 plus other products, Reville noted. Both have been key factors noted in its modeling results as growing risks since the company was formed, he said.

When asked about cyber as a potential “asbestos style” risk, Reville said it is very unlikely that cyber would fall into that category. There indeed could be potentially significant damage from a full-scale power grid attack. However, when writing commercial cyber coverage, the amount of exposure insurers have is small, even though the potential damage to a given business may be significant. Typically, insurers do not cover losses associated with a fall in market cap or related to reputational harm, which would be the largest costs from a cyberattack. In general, financial losses are harder to insure than other risks, the CEO said.

Over the last two years, interest in acquiring leading modeling technology has grown among insurance software companies looking to provide a one-stop-shop for carriers, according to industry reports. In January 2017, Verisk Analytics acquired Arium, a company specializing in liability risk modeling for an undisclosed sum. That deal was followed in October 2017 with Guidewire Software’s purchase of Cyence, a leader in cyber risk modeling and analytics, for $275m.



Featured Article

InSpirAVE seeks “kindred spirits” for investors, partners, CEO says
11 Sep 19 Tags: partnerships capital raise PersonalFinance OpenBanking City: New York City State: New York Region: SiliconAlleyNYC Open: PDF

By: Kevin Nafziger

InSpirAVE, a New York City-based startup whose app helps people save for important purchases with the help of family and friends, looks for both investors and partners where there is “a meeting of the minds,” CEO and co-founder Om Kundu told this news service.

InSpirAVE wants to work with organizations that share its goal of encouraging financial responsibility through social support, Kundu said.

Kundu finds that relationships with partners or potential investors work better when there is alignment on key values. InSpirAVE is very receptive to working with “kindred renaissance spirits,” he said.

InSpirAve was founded in 2014. Its app lets users save for items offered by online retailers including from eBay and Amazon. A user can select an item via the InspirAVE platform and then later buy it once that person has enough funds allocated for the purchase. The InspirAVE app links to a user’s bank account and the user sets how much should be withdrawn at regular intervals to go towards that item’s purchase.

InspirAVE users can also invite friends and family to comment on the purchase. Those friends and family can provide encouragement, or alternatively steer the person to other items, Kundu said.

Friends and family are also able to contribute their own funds on InspirAVE towards a user’s purchase if they choose, Kundu said. Recent graduates, who may still depend on financial support from family, often find the platform useful as a way to signal to their “nearest and dearest” which items truly interest them. “It can serve as lubrication for the conversations that need to be had,” Kundu said.  

The ultimate aim though is to help people change their spending habits, by allowing people to set realistic goals that they can achieve over time with the support of those closest to them, Kundu said. The instantaneous, often addictive nature of online shopping has made it almost too convenient for people to buy things, and can lead some to forget that buying one item means less money to purchase something else. Indeed, society’s over-reliance on credit and the isolated nature of most purchasing decisions may be a contributing factor to some of today's’ most serious societal problems Kundu argues, citing a December New York Times’ article by Aaron Ross Sorkin.

Apps to help people save are growing in popularity, many of which have been enabled by technology from payment and banking infrastructure providers such as Stripe and Plaid.

Some popular apps for personal financial management include Digit ($36.3m raised ), Qapital ($47.3 raised) and Stash ($147m raise). Investment platforms such as Acorns (valued at $860m after a January capital raise) and Robinhood (valued at $7.6bn after a June raise) also allow users to regularly make small contributions to help grow their investment portfolios a little at a time.

Norway-based Spiff, Helsinki-based Bankify, and Columbus, Ohio based TribeVest are three startups that also have apps that provide a way for groups to pool funds for a collective purchase, like a trip, a gift, team equipment, or even a racehorse (To see FHM’s prior stories on Bankify and TribeVest, click on the links above.)

Kundu said he has issues with some rival apps that require a person to spend money first in order to save only a small amount at the end of the purchase. Those approaches are ultimately self-defeating as they don’t encourage better habits, he argued.

InSpirAVE also differentiates itself from other offerings through its use of social support to help individuals with purchasing decisions. Asking loved ones for advice on shopping is ultimately more logical than checking product reviews on Yelp or relying on other financial allocation tools, Kundu said. After all, “no one knows you better than mom,” he said.


Featured Article

Founder Insights, a Q&A with Finbox’s Guillermo Guzman
03 Sep 19 Tags: Expansion capital raise OpenBanking Lending City: Bogota Country: Colombia Region: LatinAmerica Open: PDF

By: Berenice Caballero

Guzman is founder and CEO of Finbox, a Bogota, Colombia-based aggregator of credit and savings products for individuals and SMEs. In the Q&A, Guzman discusses the rollout of the company’s MVP, its desire to provide financial access to the unbanked, and its potential interest in raising outside funds after reaching key milestones.  

Can you tell us a little about Finbox? 

Finbox is a platform where individuals and small business go to gain access to a wide array of Fintech products. Many of these products are not yet widely available elsewhere. The platform is designed to provide the unbanked and underbanked with access to services that help them achieve greater financial freedom.    

Some of the products directly designed for this purpose are savings and investment vehicles. The platform also features credit and nano loans for individuals and similar offerings for SMEs.

The platform will also benefit Colombia Fintech companies, as those companies gain access to a wide range of new customers.  

When did you start Finbox and what motivated you to do so?

We were incubated by the Founder Institute starting in the spring of 2019. Our minimum viable product (MVP) goes live at the beginning of September. 

Our mission is to promote financial inclusion. A large portion of the population in Latin American has little or no access to financial services, and little financial education. Without such access or education, it is all but impossible to gain wealth. One of the biggest problems in Colombia is that the majority of the population has no savings. Closely tied to that, is the problem of overspending, as many also routinely spend beyond what they earn. The result is that the gap between the wealthy and the majority continues to grow.   

Our initial target demographic is Generation Z, or centennials - those beginning college or university and Generation Y or millennials, those in the early stages of careers and family. 

Once we have validated our MVP, we will offer a financial education program to users presented as a series of games. These games will essentially be micro-courses where users measure their progress and earn points. Those points can then be redeemed with Fintech vendors and participating neo banks.

What are the company’s top priorities for the remainder of 2019?

To validate our MVP and to continue to validate our platform through additional releases. We will do this until we reach a critical mass of users. Our aim is to have 300,000 active users within 30 months of our launch.

How big is your team and do you have plans to grow it?  

Today we have four people. The idea is to scale in the most productive way that maximizes value for our users.

What kind of support have you received from other entrepreneurs in Colombia?  

All the Fintech companies we have talked with have expressed an interest in getting users directed to them through our platform.

What are some of the lessons you have learned thus far that might be valuable to new entrepreneurs?

It is important to focus on key metrics that center around the user’s major concerns. If a product cannot alleviate the user’s major source of pain, then the team needs to move quickly, continue to iterate, until reaching a solution that can.

Do you see the potential to expand beyond Colombia?

Across Latin America, the issues of lack of access to financial services and a lack of financial education are similar. These issues have been identified by the UN as a concern for the region. So it is a matter of identifying the opportunities and solving the problem for each place where they exist.

What is the competitive landscape like for Finbox?

There is a lot of attention now on helping the unbanked, a concern many of us in the Fintech community share. Finbox is a solutions integrator. Competition between brands benefits users and at the same time broadens the range of possible integrations.

Have you raised external capital thus far? Will you look to do so in the future?

To date, we are bootstrapped. The moment we validate our MVP and reach a critical mass of users, we will be in a position to show projections on future growth. At that point, we will undoubtedly require funding to scale.

Is a part of you already satisfied to have started Finbox?

No, not at all. Dissatisfaction is our engine. When we become satisfied, we must surely have a new conversation.


Executive Spotlight

Interviews and profiles of Fintech and DLT executives

Key Features:

Fintech Horizons provides actionable insight on a company's growth strategy including on topics such as capital raising, international expansion, M&A, and partnerships. The articles are written for people of all technical backgrounds, and the site has no paid content or ICO advertisements.‍

Fintech Horizons is reasonably priced and has a friendly, easy-to-use interface.

Data :
Access company, executive and article data archives to find information about the people and companies at the cutting edge of fintech innovation. The company data section contains tweets, videos, company milestones, funding history, investors, competitors, social media links and articles from the web, while the executive data section contains contact information, videos, biographical insight, and links to articles written by or about that executive.

Industry Insight:
Stay informed with our newsletters and sector reports. Track the latest industry news through our curated From the Web and Twitter feeds. Follow the prices of your digital assets through our ICO data feed.