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Insurance disruptor plots global push after banking $31m

Michael BaileyRich List co-editor

Aug 31, 2021 – 5.00am

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Sydney-based insurance technology start-up Open has raised $31 million to launch in New Zealand and then Britain, taking the total raised since its 2016 launch to $53 million.

Founded by Jason Wilby and Jonathan Buck, previously the founders of innovation consultancy Auxilio Ventures, Open is best-known for its Huddle brand of insurance driven by artificial intelligence.

Open co-founders Jason Wilby and Jonathan Buck.

Promising car insurance where premiums go down the less a policyholder drives, home contents policies that automatically update if security cameras are installed, and travel insurance that can detect and update when a policyholder lands in a new country, Open claims more than 70,000 customers across Australia.

These include Huddle customers and those insured via Open’s application programming interfaces, which “white-labels” insurance. Open’s partners include Telstra Plus and On by EnergyAustralia.

The $31 million Series B funding round, led by New Zealand-based venture capital firm Movac and British-based counterpart Latitude (part of the LocalGlobe group), was also joined by Open’s seed investor and underwriter in Australia, The Hollard Insurance Group, and returning investor AirTree Ventures.

Tower Insurance will underwrite Open’s New Zealand push, which is scheduled for late this year.

Meanwhile, Mr Wilby and Mr Buck, locked down in Queenstown and Sydney respectively, are engaged in Zoom meetings with potential underwriters in Britain, where a launch of mid-2022 is targeted.

“Latitude have invested in more than 10 insuretechs, and they’re of the opinion that nobody else is doing what we’re doing,” Mr Wilby said.

Tasks completed automatically

Open’s algorithms claim to detect patterns in customers’ buying and claiming behaviour, and also use shared industry claims data “in a systematic way that legacy systems cannot”, Mr Wilby said, to reduce fraudulent claims and improve the experience for honest claimants by paying them within seconds.

Open says 80 per cent of the tasks required from initial quote to policyholder claim are either completed automatically or via a digital self-service experience.

“People want insurance to be available, fast and tailored to their needs,” Mr Buck said.

However, there are still call centre staff among Open’s 55-person headcount.

“They also want to know there’s a human being on the phone to help them if they need it,” he added.

We’re not a unicorn yet, but we’re on our way.
— Jonathan Buck, Open co-founder

Apart from the expansions into New Zealand and Britain, the founders will use the $31 million to build developer teams across the company’s offices in Sydney, Sunshine Coast and Auckland. Insurance products for small-to-medium enterprises will also be added to its consumer offering.

Open’s headcount would grow to 80 people worldwide by Christmas, Mr Buck said.

The founders declined to reveal Open’s revenue – other than to say it doubled in 2020-21 – or the valuation on which the $31 million Series B was struck.

However, Open made a list this month of start-ups which AirTree believes are worth more than $100 million, and Mr Wilby said Open had reached that milestone prior to the Series B.

“We’re not a unicorn yet, but we’re on our way,” he said.

Before the Series B, the founders owned about 36 per cent of Open between them, accounting for both shares and options.

All staff are assigned shares after completing their three-month probation.

Michael Bailey writes on entrepreneurship and the arts. He is also responsible for the Financial Review's Rich Lists. He is based in Sydney. Connect with Michael on Twitter. Email Michael at m.bailey@afr.com