Fundraising Stories: Transforming InsurTech from the Inside Out
Megan is part of Sie Community and participated in our very first Cohort with Anansi. Since then she has raised £1.5M in funding led by Octopus Ventures, and she was happy to share her journey with the rest of the founders, and the importance of building a network.
What led you to build Anansi?
Ana and I come from different backgrounds. My background was in finance, where I spent five years working in London and Munich investing in clean technology and industrial efficiency companies. I enjoyed the concept of using software to improve industrial processes and wanted to take on a more entrepreneurial role, so took a deep dive into learning more about machine learning and data science. I founded a small e-commerce side-project and realised that a seamless and coherent approach was achieved by using apps in all aspects of the business, except when it came to insurance. I had to rely on a prehistoric process to insure my products — filling in PDF forms, which were static and inefficient.
“We did not formally create Anansi until we secured the contract for our first project.”
Ana was one of the early developers at the fintech company Moneyfarm, so she had experience of building data pipelines. Like me, Ana was surprised that there was no product that pre-populated insurance forms for small businesses with data that was already available. The first project that we worked on together was a proof of concept for a European insurance company, to take publicly available company data on newly formed companies to support the business insurance sale process. We did not formally create Anansi until we secured the contract for this first project. Soon after that, Ana and I started working together to bring our own insurance product to the market. It can take many months, if not years, to secure insurance capacity for a new concept, so it was only after securing an agreement from the CEO of WAKAM (previously La Parisienne Assurances), to pursue our automated goods-in-transit insurance concept that we began the angel fundraising process.
How did you navigate through your fundraising journey?
We were very fortunate to have friends who were able to support us as angel investors, and they really believed in our mission and our vision behind the product. We raised our pre-seed of £150,000 by December 2019 using an SEIS-eligible SeedFAST Advanced Subscription Agreement (ASA), which was then converted to equity after 12 months. Since then the rules for the ASA have changed, so they need to be converted within six months, not twelve. In December 2020, we received an additional £100,000 from existing investors, an angel investor, Chris Adelsbach, and from Norton Rose because we had won the Insurathon prize during that time.
“ We would encourage founders not to be afraid of sending clear, intentional cold messages.”
We actually reached out to Chris by cold emailing him. We would encourage founders not to be afraid of sending clear, intentional cold messages. He is known for investing in fintech companies with female founders and from underrepresented groups, and we had heard that one of his portfolio companies, Marshmallow, a fellow insurtech company had raised around £30 million in their Series A round. After a few calls and meetings, Chris became an investor in Anansi and has been a really great support — offering advice and has been incredible for making introductions to investors.
What would you have done differently?
I would have turned down meetings with venture funds until we felt a bit more ready. Sometimes venture capital firms can approach you earlier in the process then you are ready for. It is difficult to know exactly when you are ready, so you will probably end up wasting some time in meetings with investors that aren’t going to work out. However, it is important to think very carefully about what stage your company is at in its fundraising journey before meeting with investors.
“I have learned that fundraising is a process that takes time and is one where you face setbacks, but it is also one where you will continue to experience improvement and growth.”
What have you learned from this experience?
It has been a long journey, and I have learned a lot from this experience. One thing I have realised and am particularly grateful to have had during this fundraising process is my co-founder, Ana; especially when it comes to bouncing ideas off each other. I admire people who have founded companies on their own because I think it must be a very challenging process.
I have learned that fundraising is a process that takes time and is one where you face setbacks, but it is also one where you will continue to experience improvement and growth. For example, when you start pitching, it is almost inevitable that you will have terrible pitching encounters. However, the process gets better over time and with practice your pitch does too.
“It is important to not focus too much and not get bogged down on being a female founder. If you focus on your mission, your customers, who you are and why you are doing it, investments will be sure to come at some point.“
From your experience as a female founder building an insurtech business, what are the best tips and lessons learned from delving into a very male dominated industry?
It is important to try and find allies — including male allies. Having a strong network is imperative. I would also say that it is important to not focus too much and not get bogged down on being a female founder. If you focus on your mission, your customers, who you are and why you are doing it, investments will be sure to come at some point.
In addition, it is important to take and reflect on all kinds of feedback and listen to people’s advice. Sometimes it is worth pivoting or diverging from an idea slightly if it is still within your company’s vision and goals. One of the reasons Anansi was able to close its seed round is that in response to feedback from some of our senior industry advisors, we focused on a narrower product range that could be more easily expanded internationally.. We made these changes having listened to several senior advisors who had experience of investing in insurtech companies in other verticals. However, we made these small changes while remaining true to ourselves and our mission, which was important to us.
Any final advice you think is important for female founders starting their fundraising journey?
Office hours are really helpful. Attending multiple ten-minute meetings with investors helps to give greater exposure and enables you to meet a wide range of investors. Sie Ventures has been great at giving this access to an investor network. Also, do not be afraid to reach out to people, even if you think it is pointless. If we had not reached out to Chris Adelsbach via email, we would not have received his investment or met other investors he introduced us to.
I also think it should be stressed that while the fundraising process can be intimidating, it is not a one-way process. There were several times where we turned down investors, even when we didn’t have funding, because we did not think the investor was the right fit for our company. You need to remember what your company’s mission is and you need investors who have this same mission. At the end of the day, you will be working with these investors for a while, so you want to ensure that the people who end up on your cap table, are the right ones.
