Tuesday, May 06, 2014

Jump Starting Embrace Pet Insurance



I like Embrace Pet Insurance because their web site tells you something about dogs, dog health, and the expense of dogs. Check it out!

The opening line of every breed listing:
As a pure breed, [insert breed name] are more susceptible to genetic health issues than mixed breed dogs. Whether you just brought home a young puppy or have a full-grown adult, each segment in a dog's life brings about new health risks.

Bingo!

Entrepreneur magazine has an article about this woman-founded company entitled How This Pet Startup Raised $4.5 Million in Funding:

While at the Wharton School of Business, Laura Bennett and Alex Krooglik realized there was a tremendous untapped business opportunity in the U.S. pet insurance market. People loved their pets, yet they had no way to ensure their safety and healthcare. The two put together a business plan that won their school’s business plan competition. But they would need more than a plan to get their business off the ground....

While Cleveland wasn’t home to any accelerators or angel investors at the time, Krooglik had come across an article about a new non-profit venture development organization (VDO) in Northeast Ohio called Jumpstart, designed to boost entrepreneurship in the region. It hadn't yet funded any startups, but was accepting applications for its first round of funding. Embrace put its name in the running and was one of three companies chosen from 150 in the region to get support.

Eventually, the non-profit would invest $800,000 in the company over the course of three years and connect it with other sources of funding to raise $4.5 million in total, including VC funding and angel investments. Today, Embrace has more than 50 employees and an annualized insurance premium of about $16-million (translating to $6-million of annual revenue). "Without Jumpstart, there would be no Embrace," says Bennett....

[W]hile Jumpstart initially agreed to contribute $335,000 in funding to Embrace, the money didn't come all at once. The first $80,000 it received had to be stretched over the next two years before the company reached a critical milestone -- signing up with an insurance partner to underwrite its claims. Bennett and Smith met regularly to discuss the company's progress, and Embrace was required to share monthly financial statements. Furthermore, the company was restricted to spend Jumpstart’s funds on only what had been outlined in its two-year budget. "They were helping us make wise decisions," says Bennett.


2 comments:

Nora said...

When I was looking around for pet insurance for my youngest dog, though, I got quotes both as her assumed breed AND a mix. The difference in monthly cost was only a few dollars.

Ian Logan said...

Cough! Should that not be The United Kingdom and Northern Ireland?
He writes from hopefully a soon to be independent Scotland. ;-)

I know, I am being flippant. Enjoying your blog as usual. Thanks!