August 27, 2025 • 38 mins
Summary:
In this episode of Insurance Unplugged, host Lisa Wardlaw interviews Brittany Clements, Managing Director at American Family Ventures. They discuss the current state of the insurance market, particularly focusing on insurtech, life, and annuity sectors. Brittany shares insights on market trends, the importance of diversity in funding, and the dynamics of startup teams.
The conversation emphasizes the need for innovation in life and annuity, the significance of strong founder teams, and the ongoing challenges in securing funding for diverse entrepreneurs. Brittany also provides actionable advice for founders and highlights the importance of measured growth in startups.
Takeaways:
Brittany Clements leads American Family Ventures, focusing on insurtech innovation.
The venture capital market is showing positive signs, especially in exits.
Life and annuity sectors are often overlooked in funding opportunities.
Diverse teams in startups tend to outperform their counterparts.
Founders need a balance of selling and building skills.
Unit economics are crucial for sustainable business growth.
AI tools are often overhyped and can be easily replaced.
Investing in life and annuity can yield significant market opportunities.
Startups should focus on measured growth rather than growth at all costs.
Diversity in funding is still a significant gap in the industry.
Sound Bites:
"It's been fast and slow."
"Diverse teams outperform."
"Stop with all the meetings."
Keywords:
insurance, venture capital, insurtech, life insurance, annuities, diversity, funding, market trends, startup advice, Brittany Clements
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:01):
Insurance. Unplugged in the hot seat where
the complex world of insurance is laid bare.
Hosted by Lisa Wardfall, this podcast promises an unfiltered
glimpse into the industry like never before.
Each episode invites you to listen in on the candid
conversations that usually happen behind closed boardroom
doors. From deep dives with industry
(00:22):
leaders and thought leaders to innovative discussions with
minds shaping the future of insurance, we bring the most
genuine talks. Directly to your ears.
Our guests take the hot seat alongside me to explore the
inner workings, challenges and triumphs of the insurance world.
If you've ever. Wondered what goes on in the
shadows of the insurance industry?
(00:43):
From the boardroom banter to thebehind the scenes strategies,
this is your chance for a front row seat.
Prepare for. Unguarded, enlightening and
engaging discussions. That cover every.
Angle of Insurance presented in a way that's both insightful and
accessible. Welcome to the conversation.
Welcome to Insurance Unplugged in the hot Seat with Lisa
(01:04):
Wardbaugh. Welcome back to another episode
of insurance unplugged, Hot SeatEdition.
Today's guest speaker speaks fluent Ledger and future.
I am so excited to have her on the podcast.
Brittany Clemens and I met, Oh gosh, at conference a few years
back and we decided we had so much in common, both from our
(01:24):
origin story of accounting, which don't anybody turn it off
yet. I promise it's going to get
spicy in a minute. I say, Ken, everyone like
delete, don't listen. No, it's going to get super fun.
But, you know, we really see, and I were raised on balance
sheets, audits, financial modeling and discipline of
reconciliation, which I love, where this is going to go in the
(01:44):
conversation, what's real and what's not as soon.
She now leads American Family Ventures as a managing director
there, where she really backs companies in rewiring the rules
of insurance. So again, Brittany, welcome to
the hot seat. If you don't mind introducing
yourself to our audience who maynot know you and all the work
you're doing at American Family,welcome.
(02:07):
Awesome. Well, thanks, Lisa.
So, so great to be here. Us, us fellow Cpas have to have
to stick together, I'd say. So big fan of of yours, the
podcast. Thrilled to be in the hot seat
here today. At American Family Ventures, we
invest in the future of the insurance industry.
And this is a category I've beenfocused on for the past 10
years. My team's been at it even longer
(02:28):
since insurtech became a thing and our business has really
evolved over the years. First as a strategic investor
investing off balance sheet and you know, now Fast forward to
today, we're investing out of our 4th fund.
We have the privilege of being in this really interesting spot
in the ecosystem where we get tointeract with great insurance
carriers like American Family Insurance and a lot of other
(02:50):
limited partners and carriers inthe space.
And then entrepreneurs who are building really interesting
things and innovating and building the future of the
industry. So thrilled to be here today.
Think it's going to be a fun discussion?
So excited, so welcome to the hot seat.
Let's unplug. You know, you and I love to
break it down. Let's unplug theater kind of get
to the truth, in particular withscale and what really matters.
(03:13):
So our first segment, and you know, I caught you right in the
middle of the year. So I want to pick on you a
little bit to kind of help me with a mid year filter.
And I spend a lot of time on my own, not, not with ventures, but
really focused on signal versus performance arts, like right,
like a lot of time breaking downthe hype.
Here we are in July recording this.
(03:34):
I'm starting to re forecast likewhat is moment of the year?
And everyone is like trying to look strategic, maybe quietly
pivoting in particular with foundations, with
infrastructure. And I'm not saying AI is a hype,
but really scale, right? Like what's going to be there?
What can we do to get, I'll callit beyond the POC?
(03:54):
So what is your mid year take? You know, what do you see is
real? What's hype and what do you
think might be past this expiration date, Brittany?
Like what are you seeing as thismid year look?
Yeah, so an absolute wild start to the year.
You know, it's been fast and slow.
I can't believe it's it's halfway through the year.
But then you look back and you think about everything that's,
(04:16):
that's kind of transpired and and kind of moved and, and, and
changed. So I think it's a, it's a great
question. As I think about the market, the
venture capital market and insure tech specifically,
there's maybe a few things that give me a lot of optimism around
where where we're at in the market today relative to to
where we started the year. The 1st is probably really
(04:37):
positive signals of of life whenit comes to the exit
environment. And this spans all venture, but
is especially true within the insure insurance category.
You know, couple, you know, we've seen big acquisitions,
Munich reacquiring next insurance for 2.6 billion, you
know, probably the largest, the the largest acquisition number.
(04:58):
That. That was that was that was the
one a lot of folks. Were looking for.
Exactly. Evolution IQ acquired by CCCM
and a deal count in Q1 was the highest it's been for the Inter
Tech category over the past several years.
Some IPO activity, more on the docket here here kind of going
forward. And so, you know, I think all of
(05:18):
that's really positive and necessary for a healthy
ecosystem. And if you think about the way
this business works, venture capital firms need to raise
money. So then they can deploy that to
startups who are innovating in the space and they can build new
things and and innovate in the industry.
But without distribution, you know, that doesn't happen.
So I think it's it's been reallypromising to see some of that
(05:39):
stuff hopeful to see continued activity on that side of the
aisle as well. The other thing that I would
really call out from a market perspective is probably the
continued commitment from carriers to the insurtech
category. And so if you look at the broad
funding cycle, right, like, likenobody knew what insurtech was
like a decade plus ago. And then there was this huge
(06:01):
hype and run up in 2021 where, you know, fifteen, $16 billion
was invested into the category. And then that dropped
significantly. And a lot of generalists kind of
like stepped away. People weren't very excited
about investing in the category.But simultaneously, if you look
at insurance carrier and privateinvestment into the category,
2024 was a high watermark. Q12025 was another high, high
(06:24):
watermark on a quarterly basis. And so I'm really excited about
that stat because it just shows that, you know, insurance
carriers, incumbents, folks who know and understand insurance
are continuing to stay invested in innovation and, and some of
the stuff that needs, needs to change here, here moving
forward. You know, I, I think that's
interesting to you, Brittany, because I think to your point,
(06:46):
like a lot of people follow someof the macro without seeing the
kind of some of those replacement funding metrics.
And there's also this other trend that I see, which is, and
I'm going to like kind of bring it back to funding, which
especially like there was a lot of kind of leverage resource
models, right, in insurance. I mean, we're, we're, we're a
very heavy resource intense, youknow, industry, both capital and
(07:09):
labor. And you know, clearly throughout
the decade, you know, I would say the last 20 years, I've been
focused a lot on, you know, leverage resource models to
business process optimization onshore, offshore, You know, we
look at TPA, you know, like kindof I'll say compartmentalization
of specified and specialized resourcing.
We we've always been doing that.And and then you kind of bring
(07:31):
in AI and a genic AI. And I think carriers in
particular are starting to say, well, is it the resource model I
need to look at? So maybe I need to bring some of
that back in house. But if I bring that back in
house, what capabilities do I need to have in this new era and
include that's gone beyond just digital or automation or
(07:52):
intelligent automation? And so I think one of the
interesting kind of I'll say connections to what what you're
saying would be funding is are you seeing then with the way
that the environment is working,it's like, well, if we start to
think about this as like resource in totality, might we
might need some of those edge scenarios to process this if we
(08:12):
want to bring kind of specialized processing back in
house. I mean, have you kind of
connected it to that yet or is that an early signal?
Yeah, No, I think I think definitely have and, and with
AII mean it's, it's, you know, how do you sell, sell the work
and, and actually tie that into not an enterprise SAS license or
something like that, but the actual outcome.
(08:33):
And we're seeing a ton of companies, I would say building
AI for insurance. I think a lot of them are still
kind of in the workflow automation side of things and
not really delivering on the outcomes.
And that's where I think these need to continue to shift.
I think some folks are focused on it, but then it's like how do
you build a lasting advantage within that category?
(08:56):
And I think you have to have thedata advantage which start-ups
and don't have right like that'swhere carriers.
So it kind of starts and ends with data and like the.
Quality of the policy to have that.
Advantage or something like that.
And so, so like when we're looking at those companies, I
mean there's, there's a ton of them.
We're we're seeing multiple pitches every single week kind
(09:18):
of in and around those categories.
And I think there's some promising concepts, but it's
like, how do you create the defensible lasting edge over
time? And you know, I think it has to
be in in concert with with the carriers who hold all this data,
but they have to be able to unlock it and use it.
So we're not quite there yet. I love that And I'm just going
(09:38):
to, we're not going to get too technical because I want to kind
of make sure we get through all the macro parts, but I just want
to kind of plant a seed. If you and I ever come back and
have this discussion again, I want to plant a seed of
foreshadowing and forecasting here.
Because I think to your point, what everyone seems to be
pitching and focusing on, we would have called it like point
solutions back in the digital day.
(10:00):
And now I will call it like they're like automating
processes with Agentic or AI or whatever.
But where we're really seeing orI'm seeing the missing gap is to
your point, I live where they use outcomes because I'm
starting to frame it as outcomesas a service.
What we're really missing is that fluidity of outcomes and
outcomes as a service, which gets into the layer underneath
(10:23):
the, the, the process. And we're really talking
calculations, We're really talking logic layers.
We're really talking like end toend.
Don't tell me how you achieve the process, like get to the
outcome. And of course, we're starting to
look at techniques of verifiableproofs and all these things.
So I think I love the fact that you use the word outcome and you
and I didn't plan that in advance, but I, I'm starting to
(10:46):
see outcomes as a service becomea very interesting category in
the work that I'm doing and seeing.
And I, I wonder if that kind of correlates into what you're
talking about as well? Yeah, I absolutely see it, see
it going that way. And the, the other thing that I,
I, I kind of think about is, youknow, folks who are spinning up
(11:07):
the tools and, and the tooling and selling those in.
And like, you know, like those sales cycles could be long and
hard versus, you know, folks whoare building the harder thing
and, and like building like techenabled carrier or a tech
enabled TPA or like doing the hard work and enabling it with
technology. And so I think those are a lot
of really interesting models, models as well, which is maybe a
(11:29):
little bit different from, you know, bringing that back in
house. But it's like, you know, could
you partner with a new provider that is doing it with
significant cost advantages at the end of the day?
So yeah, yeah, I love that. Clearly we have even within
carriers, right, we have levels of different, you know, carriers
have their, we'll call it their traditional model, they'll have
(11:49):
their digital model, they'll have all these entities that are
also serving that. So at your point, insurtech has
matured so much over the last 10plus years that it wasn't this
binary scenario that we had, youknow, prior to the evolution
that we're in now. And and I think the M&A activity
is also supporting that, right? Like that's what you're seeing.
So I love seeing that. Well, let's let's move into not
(12:10):
only do you and I share a littlethree letter title PA, but we
also both grew up heavy and deepin life and annuity.
And I love the fact that you arean expert in this area,
Brittany, because I think a lot of people, I don't want to say,
think of a thought, but they don't we, we see a lot of
emphasis on PNC topics and property and casualty thought.
(12:33):
Like, you know, like, I don't know, I always have to say
people, it's not PE, it works very differently, but it, but
it's huge with the, the interestrate markets and the macro, even
the PE interest that we have in the annuity space right now.
So let's go, let's take a littledeep dive into kind of like from
afterthought to edge. And you know, when you and I
(12:54):
first talked about life and annuity and I saw that
innovation map, I really thought, yes, like this really
reframes it. This is really kind of a
pertinent view that we're missing, but what do you think
is still being ignored or maybe overlooked in life and annuity?
Why do people in, I'll call it, in the technology space, like,
(13:17):
you know, people coming in for funding, Why do they often
overlook it or not tackle it? What's your thought there?
And are people waking up? Are you seeing movement there?
You know, I think the short of it is everything is still being
the life and annuity space unfortunately and.
For the poor people that work there, they're like we're.
(13:38):
Like this is going to be the year, this is going to be the
year. But but but the piece like the
market is massive. Like we we know how how big the
market is coverage gap is growing.
You know, it's, it's, it's like not shrinking and capital
continues to be the missing piece in in my book.
And you know, there's a lot of different sources for insurtech
data out there. FT Partners puts out a quarterly
(14:00):
report. And I think I think they do a
nice job of it because they actually break it out by product
line. They don't lump life and health
all together like a lot of otherfolks do.
And when you look at. Gaming is not the same.
Right, right. But when you look at last year's
funding volume, I think there was like over $5 billion that
went into to the category. Again, pretty stable year over
(14:21):
year, 2% went into the life and annuity category.
So 90 million of $5 billion plusflowed into that category.
And so I think I, I look at those numbers and, and there's
some interesting innovative companies kind of on the early
stage of that. So I'm excited to see them
continue to grow and mature. But I'm hoping that we get more
capital coming into to the spaceto fund, you know, some of the
(14:44):
opportunity sets we have here toreally, you know, expand the
value proposition of life insurance and, you know, solve
for the coverage gap. And like, there's so many things
to go after here and, and lessons that we can learn from
the PNC side and apply on on this side of the aisle as well.
So. So if there's a startup founder,
and I have quite a few of them that follow follow the podcasts
(15:04):
and the blogs. If there's a startup founder and
a founding team and they have a discreet outcome oriented
solution, right, like one that'sgotten merits, it's got Tam, it
can get to your point. It has that ability to saturate,
you know, and work with the carrier or you know, and they're
on the cusp. They're like, you know what, we
could go PNC or go life and annuity and they're talking to a
(15:28):
strategic advisor, which a lot. These are actually a lot of the
people that come to me and say, Lisa, how should we approach the
market? You know, what should we do?
And I often look at it and I kind of go back and forth with
when my recommendation to them, like do you want to go PC?
Here's all the present cons. Do you want to go life and
annuity? Here's the present cons.
It's interesting, Brittany, they'll usually gravitate on the
(15:50):
outset towards property and casualty.
And, and I'm telling you, it's like agnostic between the two.
I, you try to say, you know, have you looked at the life and
annuity space? And, and clearly the, the cons
are like there's not central like kind of like a big 5 admin
operating system, right? It's much more homegrown, much
more dispersed. To your point, it's massive.
But I also you talk about, but we haven't spent as much over
(16:13):
the last decade going through, I'll call it like the innovation
fatigue cycles, right? So it's a little bit more right
to coming in with a like a like,like Hindsight's 2020, right?
Like you could come in and say we've learned.
What would your advice be to those founders that have that
equal decision? They're at fork or why in the
road? How would you advise them to
(16:33):
think about it? Because I know there's no
declarative with one they take. Yeah, You know, I, I think, I
think you definitely could go either way.
I think the, the challenge with life is, you know, the long
tail, you know, complexity, there's so many different
permutations of products and stuff like it's, it's so
different than a lot of things that you see on say like
personal lines and, and, and that side of the house.
(16:53):
And so I think it is diff. I would probably point, you
know, I'm going to be a little bit biased in this answer, but I
would point to market opportunity.
I would point to just the potential, a competitive
landscape in itself, right? Like there's just fewer
companies going after a pretty big prize at the end of the day.
And so I would definitely tell them that and ask them to call
(17:16):
me. I was going to say, and they
could call Brittany because doesshe need American Family's
venture fund? But she has a big background in
life and annuity. And so I think, I do think it's
important that we, we often talkabout inclusion for new entrants
into. So if you're coming to solve a
problem, how we, how we don't isolate people with being like,
oh, we're insurance you, you know, but I think life and
(17:39):
annuity we're also even more exclusive.
So I think there is some inclusivity there that's needed
because it isn't intimidating. Like I, I literally caught
myself too two weeks ago, Brittany, someone was working on
a technology solution for reinsurance and they were
thinking property and casualty. And I caught myself saying to
them, like, you have no idea howmuch more infinitely complicated
(18:02):
this is for life. And they said why?
And I'm like, well, you have to regenerate the calculation for
every single cell, for every single policy for every single
movement from inception to date.And they're like, oh, and I'm
like, that's not the way it works in PNC, right?
And so I, I caught myself almostunintentionally like kind of
(18:24):
like saying it's so much harder.And to your point, it is, but I
think the hard parts are where we have actuaries.
The hard parts are where we havereally good modeling.
I don't think those are the hardparts in terms of, you know,
maybe bringing technology to partner with that.
Do do you or do you see that as being like like limiting?
Yeah, I think, I think it's a lot of populations.
(18:47):
I think that's a good way to putit.
And it's math and that's solvable.
I, I do think, you know, we, we sometimes have a debate amongst
our team around, you know, who are the right builders for
things in different categories. Yeah.
And whether you know, that should come from inside the
industry or, you know, outside the industry.
And I think especially within this category, you don't have to
(19:09):
come from inside the industry, but you need to hire someone who
knows their stuff. It, it can be so complex.
And I was, you know, I, I was talking to someone yesterday
who's, who's building in the LTCspace.
And I mean, it was such a fun call.
It ended up going like 20 minutes over and, you know, I
learned all sorts of new things and I've been like studying the
(19:30):
space for 10 years. So I do get that intimidation
piece, but I don't think anyone's an expert, right?
Like there's, there's, there's so many pockets of, of what it
all means. And that's part of the fun of it
all. So.
I totally agree with you and I think the reason why I 'cause I
didn't even go into life and annuity to like I would say much
later in my career, I had a benefits background, which to
your point health is not the same as, but I had a benefits
(19:53):
background, but mainly PNC. But then I, I started my
corporate world always in life and annuity.
My entire corporate career was life and annuity.
Never, never PNC my that was more my consulting upbringing,
my M and a background. But when I went into it, I fell
in love with it because of the complexity of the financial
modeling and because of the complexity of the capital
strategies connected to the financial modeling.
(20:16):
And so I agree with you entirelythat it's really, really, really
important to have somebody that understands because you won't
have any credibility with those carriers if you don't understand
the complex. That's right.
Like and I'm not saying you haveto be able to RBC.
The like, there's so many facetsthat you have to kind of balance
(20:39):
when you're when you're thinkingabout all that stuff.
And yeah, but it's, it's fun to fun to build those muscles and
you know, it, it, it's never dull.
So. When you're typing, you know,
I'm kind of interested to see with the AI agenic waves and
kind of these foundational substrate layers that I kind of
predict as like investment needs.
(21:00):
I'm kind of interesting to see how much we can learn from scale
of insurtech solutions and thinking about life and annuity
Brittany. So I, I have my, my second-half
of the year watch on that and I know some, some leaders that are
trying to build in this space. I'm very excited about it.
So let's let's now flip to founders.
So, you know, there's a lot about founders and you alluded
(21:23):
to it like certain founders, like can they build certain
types of companies? And you know, I think there's a
different type of an applicationfounder than there is an
infrastructure founder than maybe P&C life.
You know, there's all sorts of different types of founders.
But a lot of times I think we fixate on the deck and, and even
maybe the the blueprints of whatsomeone says the deck and the
(21:43):
numbers and the deck should looklike.
But what are the more subtle cues that make you like lean in
or maybe even think? I just I don't see, and it's not
personal, but I don't see this being like viable, like at this
level. What?
What are those subtle things that you look for?
Yeah. So I I think this is, this is a
great question because regardless of how good the idea
(22:06):
is, what's happening with the market, all of the above it, it
comes down to a team's ability to execute.
And so, you know, such heavy weighting is is placed on that.
And I've learned lessons over the years.
You know, I haven't always gotten this right, you know,
been fooled by charisma or, you know, different elements where I
have gotten it wrong. But you know, I have, I have
(22:27):
learned quite a bit and there's a few things that that I'm
really looking for when I'm evaluating teams.
You know, one, I think you have to have this strong mix of the
seller and the builder and and those capabilities.
And, you know, sometimes that's in a founding team, sometimes
that's in, you know, a CEO and bringing on like, you know,
your, your first, you know, really strong technical hire
(22:47):
that's, that's highly committed to, to the business.
But you know, that front person,they have to be able to raise
capital, present a vision, and then recruit really, really
talented people into the business.
And then, you know, the technical person has to be able
to actually execute and, and, and, and get the stuff done.
And so I think too often there'sfolks that are maybe a little
(23:07):
too similar in, in those regardsand don't don't have enough
balance to get both of those pieces right.
And I think both of those piecesare critical.
So I think that that that's one side of it.
The numbers accounting in me, I,I love strong grasp with the
numbers in unit economics. There's been times where that
kind of stuff has been punted and that doesn't give me
confidence in someone's ability to build a long lasting, you
(23:29):
know, scalable business. And then I think just high
trust, high integrity, low drama, you know, in it for the
right reasons and, and high ambition.
So a lot of times there's folks who are building things that,
you know, don't necessarily needventure capital funding and
could be a great business through a certain pathway.
But the, the type of opportunities we're looking for
(23:50):
are, you know, like billion dollar companies.
And so you kind of have to like close your eyes and, and like,
is this person in it for the long haul?
You know, are their ambitions aligned with like what we need
to see happen from a fun math perspective and making sure it's
a mutual fit on that, on that regard too?
You made me laugh when you of course, the billion dollar goal,
(24:11):
right? And when I first left my
corporate roles and I started working with startups I like was
puzzled. Genuine.
I, I will admit this genuinely puzzled that every financial
deck I would see put together was a billion dollars divided by
So it was like 100 million in ARR right times times a multiple
(24:32):
of 10 back in those days, you know, and, and it was 100
million ARR like, you know, maybe that goes up or down
depending on your multiples. And it was always divided by the
years to get there. And I'm like, so like this is,
this is not a financial model and, and the numbers were
derived or contrived. And I don't mean unethically.
(24:53):
It was like they knew that was the mark.
And so the like, I was like, well, genuinely, Brittany, my
accounting CFO background, I'm like, but that's not a financial
model. So how do you, how do you peel
that apart? And then the second layer to my
question for you is I grew up asdid you Brittany, with true
Financials, balance sheets, income statement statement, the
(25:16):
cash flow. And I find since I started
working with startups that they don't use the concept of
financials. They use the concepts of, I'll
call it maybe cash in and cash out.
They're not even comfortable with like like true forecast,
true accrual based financial statements with, you know, like
(25:37):
amortization, depreciation, likeall those things.
And, and clearly most startups can have ACFO that thinks like
this until they're well into like maybe BCI, don't know,
depending. So how do you tease that out?
Because I found that my own level of like oil and vinegar
and water and I'm like, whoa, how does this work?
How do you see that? So 1, I think having a strong
(25:58):
understanding for the way everything flows is really
important because like you know,there can be things that are
positioned certain ways that, you know, maybe something is
capitalized as R&D or something like that, but it's truly cash
out the door, right? So I do think like in Star, like
cash is king, you know, your jobis to not run out of money and
(26:19):
either, you know, turn to profitability or hit a really
significant valuation inflectionpoint and be able to go, you
know, raise significant capital to pour, pour fuel on the fire.
And so I do think having a good grasp on the real cash burn
number and you know how that's fluctuating and, and all that
stuff is, is super important in,in that regard.
I've seen all types in terms of like the savviness at all stages
(26:43):
as well. But there's a couple companies
that really use their financial plan as a management tool.
They are really using it to drive decisions and I love that.
So probably no, no surprise in in that end, but they are, you
know, really on top of it from, you know, what this hire means
to my margin then how it's allocated and all that kind of
(27:03):
stuff. And I would say, you know, they,
they get to the point where you know it, it truly is like
helpful to them in in their decision making.
And I think that that's a good foundation for success as you
continue to mature as a start, because I tell you like growth,
growth stage investors and as you continue to mature as a
business, that's going to be required.
So the lens that I always come in and think about it is like,
(27:23):
OK, if I'm coming in a seed stage company, how can I help
provide guidance to like what a best in class Series A company
looks like from everything from the financial models, the
statements and just like your overall KPI dashboard and stuff
that you're delivering. And then same on for, for
companies at at later stages. And so, you know, never, no
(27:43):
one's going to be perfect at, atthe beginning and you shouldn't
either because that's probably an inefficient use of a
resources when you're trying to survive, survive another day,
right? So it's, it's a little bit of a
balance and, you know, progress towards perfection.
Not not necessarily. Assuming you're you're, you're
going to be there day one and. Well, I think you brought up
some really great points too. I think like unit economics
(28:04):
margin, I think that's often again in this like divide by
yeah, it's like top, you know, and, and, and of all interest
people for anybody listening, wereally believe in the total unit
economics. It's exactly like our business
is a capital business, not a balance sheet or like just an
income statement. We're really we look at capital
(28:25):
and strain on capital. So in particular when you're
trying to partner with or sell into or get investment for
insurance where we of all peopleare not just top line focused,
we're we're unit economics focused.
And I, I think that there's often so much focus on the, I'll
call it the bright line of ARR that people forget unit
(28:47):
economics. And Brittany, I remember having
a discussion with a founder thatwas, you know, putting clients
into revenue activation, so, so into production.
And I was like, but they, but that client's not paying you
enough to cover, you know, the cost of production, the cost of
goods sold, if we just keep it simple.
And it was like, but I need the ARR And I'm like, but your unit
(29:09):
economics aren't supporting. So you're actually negative and,
and clearly like I see it that way.
I do understand there's there's stress to get top line to get to
A and when do you think this like unit economics pay like
kind of has to pay the piper in the journey from maybe C to A to
B? Did you have any guidance for
(29:30):
people? So I think it, it matters so
much earlier. I mean, I think this growth at
all cost mindset, that's kind ofwhat got everyone in trouble in
the 1st place, right? Because everyone was growing as
fast as humanly possible when they didn't even know what their
cogs were. So exactly what you were saying.
And then that backfired, right? Like, like terrible loss ratios,
unsustainable financials, like, you know, bottomless money pit,
(29:52):
right? A lot of people have learned
from that. And I think it's more about
measured, measured growth and, and, and being smart about that.
I see it as a red flag, let's say for like a, a new full stack
carrier. That's, that's, that's emerging.
If they grew like huge overnight, I would be very
(30:12):
worried about that because you don't know what's in that
portfolio. You don't know, you don't know
what the underlying risk is, right?
And so you have to be measured in your growth at the end of the
day. And I think a lot of folks are
much more oriented and focused on that today, just
understanding how these businesses will be valued at
exit. And, you know, I think just
(30:34):
having that as a good foundationbrings some good practices in
into the into the space. So we talked about this next
section is really like inclusionand I know you spend a lot of
time as you know beyond optics with diversity.
And we talked a little bit aboutkind of maybe lines of business
or areas within insurance to getfunded.
But you know who would you say is still not being funded?
(30:58):
What's the blind spot costing us?
And do you think that there is still a blind spot in investing?
Yeah, there is is the short answer.
I would say significant funding gaps for women, people of color
continue to persist. A very small portion of venture
dollars are are flowing into that.
I don't know what the actual percentages are, but I don't
(31:19):
think there's been much movementhere over the past past number
of years. And this just represents a a
huge opportunity. So, you know, I think you've
probably seen all the all the same studies I have, but you
know, diverse teams outperform and I think not necessarily
building with those folks in mind leaves a lot on the table
(31:39):
at the end of the day. So at one time I saw, and this
is this is dated, but I I assumethat this probably holds true.
But Oliver Wyman put out a report that showed underserved
women represented, like, the most significant market
opportunity in all of financial services.
It was something like, you know,a $700 billion annual revenue
(32:01):
opportunity by serving women in parity with men within the
financial services category. And life insurance was actually
like the biggest bucket within that report.
And so demographic shift, there's all this impending
wealth transfer. You know, there's differences in
mortality. More women are making financial
decisions. I just, I just think that
(32:21):
there's a big prize to be won there.
And so again, maybe another self-serving pitch for me.
But if if you know you're you'rea woman building an insurance, I
would I would absolutely love tolove to chat with you and.
And to serve the underserved in life hit Brittany up.
I love that. I just saw an ad and I won't
name the company, but I and and I'm not advocating for the
(32:41):
company, but the ad said be the mom who has life insurance, be
that mom. And I was like, I was scrolling
through social and I was like, that's such it it it's actually
getting interestingly at what you just talked about and and it
it made me pause right, like, and I just thought that's
interesting. I had never seen that before,
(33:02):
Brittany. And I just thought recently, no,
I think. I've shared like I'm a life
insurance beneficiary. So like, I think you're crazy if
if you know, like we need to be making these these thoughtful
decisions for our families. And I love that that's that's
very much on the nose and, and. I really liked I, I kudos to
that unnamed marketing team, butI was like really impressed with
(33:23):
that. And we need a lot more of that.
And to your point, we need a lotmore solutions.
All right, so let let's move into I wanna ask you a couple
questions before we get into ourroundup.
Let's go for rapid fire. So what is, you know, one deal
that you passed on that still stinks?
Chime bank series BI think the entry point was sub a hundred
(33:44):
100 million valuation and what they just IPO for close to 12
billion. So that one, that one stings a
little bit. If you were an inventor, what
would you be doing? You know, probably something
golf related. I love the game of golf.
It's it's kind of what my familyand I, I do together, played in
college, probably teaching kids golf.
(34:06):
I love that and I can totally see that.
By the way, you should have comeand hung out with me when my
daughter was over at Saint Andrews.
We could have played around. Next.
Time. What's the most underrated risk
or opportunity that you have your eye on right now?
You know, we've been spending a lot of time on reimagining long
term care and aging in place. You know, I think huge risk to
(34:28):
society with all the demographicshifts, big opportunity for
innovation there. Yeah, yeah.
I love that one. I was personally doing a lot of
work on that even five years ago.
What's the most overrated trend right now?
AI workflow automation tools point solutions can.
I see like an amplification exclamation part on I.
(34:50):
See to stand up and and, you know, unfortunately easy to be
replaced. I think so, yeah.
Yeah, not, not a lot of moot there, All right.
What's one team or teams that you're watching like in terms of
founding teams? Yeah, you know, I will, I'll
give a shout out to actually oneof My Portfolio companies.
So Alexander, my Mysore, she's CEO and founder of a company
called Alex that is they're focused on tech enabled estate
(35:13):
settlement and facilitating thismassive wealth transfer that's
that's underway. And they, they just announced a
great Series A this week. Super excited for them and
they're just off to the races. So rooting them on and and
excited to see what comes next over there.
I love that all around. OK, so we're getting to the end.
Thank you all for hanging in. Even though we started this
Cpas, we we got a little spicy in the middle.
(35:35):
OK, the the Hallmark sign off isthe call to action.
Say Brittany, what's one thing that you would ask everyone
listening today to start doing, stop doing and continue to do
over to you? All right, let's see here.
I tried to leave this one a little bit unscripted and let's
(35:57):
see, I would say, oh, this one'seasy.
So I would say start investing more capital into the life and
annuity space in in sentence on that one.
I think, you know, we spent a lot of time talking about that
today, but a lot of opportunities there, some really
interesting companies getting started.
So, so you know, let's let's seeif we can beat 90 million
(36:18):
deployed into that category thisyear.
All right, anything that you want people to stop doing?
Stop. This is this is a little self
reflection on myself. When I kind of did my own mid
year assessment. I would say stop with all the
meetings, you know, have more ofa bias towards action.
I have personally started to do more of that and just more ad
(36:38):
hoc picking up the phone, you know, no one's no one's getting
annoyed with me yet, but it justfeels more high energy, more
fun, you know, and and more productive at the end of the
day. And then continue, I think I
would just say continue it like kind of where we started with,
with like carriers continued investment, say continue
investing and partnering with startups in a mutually aligned
(37:00):
way. And you know, I've seen so much
growth here where we've moved onfrom the theater.
I think carriers and startups alike have kind of matured in
the way they partner with one another in finding, you know,
that mutually valuable points ofconnectivity and really, really
doubling down on some of those focus areas.
I love that and Brittany, like always, always, always, whether
(37:23):
I get to the benefit of being onstage with you or the
opportunity to have you one-on-one on the podcast, I
absolutely take copious notes. I love learning from you.
I love seeing you out there in the industry.
I mean, you provide not only just perspective, but a deep
playbook rooted in lots of experience, and you've always
been so open, warm, and welcoming to helping others.
(37:46):
So if they want to reach out to you and pitch something, and
they meet some of the categoriesthat you shamelessly plugged,
where should they follow you other than LinkedIn?
How should they hit you up? You know, I would just say
e-mail Brittany at amfamventures.com.
I am no problem with with the cold cold outreach on my end so
LinkedIn or OR that works great and feelings are mutual.
(38:08):
This was a lot of fun Lisa and and big fan of yours as well so
really really appreciate the time today.
Well, thank you, Thank you so much for being a guest on the
Hot Seat and for everyone listening.
We could not do this without you.
So thank you all for listening, for caring, stay curious, stay
informed, and stay plugged in until next time.
Insurance. Unplugged in the hot seat where
the complex world of insurance is laid bare.
Hosted by Lisa Wardfall, this podcast promises an unfiltered
glimpse into the industry like never before.
Each episode invites you to listen in on the candid
conversations that usually happen behind closed boardroom
doors. From deep dives with industry
(00:22):
leaders and thought leaders to innovative discussions with
minds shaping the future of insurance, we bring the most
genuine talks. Directly to your ears.
Our guests take the hot seat alongside me to explore the
inner workings, challenges and triumphs of the insurance world.
If you've ever. Wondered what goes on in the
shadows of the insurance industry?
(00:43):
From the boardroom banter to thebehind the scenes strategies,
this is your chance for a front row seat.
Prepare for. Unguarded, enlightening and
engaging discussions. That cover every.
Angle of Insurance presented in a way that's both insightful and
accessible. Welcome to the conversation.
Welcome to Insurance Unplugged in the hot Seat with Lisa
(01:04):
Wardbaugh. Welcome back to another episode
of insurance unplugged, Hot SeatEdition.
Today's guest speaker speaks fluent Ledger and future.
I am so excited to have her on the podcast.
Brittany Clemens and I met, Oh gosh, at conference a few years
back and we decided we had so much in common, both from our
(01:24):
origin story of accounting, which don't anybody turn it off
yet. I promise it's going to get
spicy in a minute. I say, Ken, everyone like
delete, don't listen. No, it's going to get super fun.
But, you know, we really see, and I were raised on balance
sheets, audits, financial modeling and discipline of
reconciliation, which I love, where this is going to go in the
(01:44):
conversation, what's real and what's not as soon.
She now leads American Family Ventures as a managing director
there, where she really backs companies in rewiring the rules
of insurance. So again, Brittany, welcome to
the hot seat. If you don't mind introducing
yourself to our audience who maynot know you and all the work
you're doing at American Family,welcome.
(02:07):
Awesome. Well, thanks, Lisa.
So, so great to be here. Us, us fellow Cpas have to have
to stick together, I'd say. So big fan of of yours, the
podcast. Thrilled to be in the hot seat
here today. At American Family Ventures, we
invest in the future of the insurance industry.
And this is a category I've beenfocused on for the past 10
years. My team's been at it even longer
(02:28):
since insurtech became a thing and our business has really
evolved over the years. First as a strategic investor
investing off balance sheet and you know, now Fast forward to
today, we're investing out of our 4th fund.
We have the privilege of being in this really interesting spot
in the ecosystem where we get tointeract with great insurance
carriers like American Family Insurance and a lot of other
(02:50):
limited partners and carriers inthe space.
And then entrepreneurs who are building really interesting
things and innovating and building the future of the
industry. So thrilled to be here today.
Think it's going to be a fun discussion?
So excited, so welcome to the hot seat.
Let's unplug. You know, you and I love to
break it down. Let's unplug theater kind of get
to the truth, in particular withscale and what really matters.
(03:13):
So our first segment, and you know, I caught you right in the
middle of the year. So I want to pick on you a
little bit to kind of help me with a mid year filter.
And I spend a lot of time on my own, not, not with ventures, but
really focused on signal versus performance arts, like right,
like a lot of time breaking downthe hype.
Here we are in July recording this.
(03:34):
I'm starting to re forecast likewhat is moment of the year?
And everyone is like trying to look strategic, maybe quietly
pivoting in particular with foundations, with
infrastructure. And I'm not saying AI is a hype,
but really scale, right? Like what's going to be there?
What can we do to get, I'll callit beyond the POC?
(03:54):
So what is your mid year take? You know, what do you see is
real? What's hype and what do you
think might be past this expiration date, Brittany?
Like what are you seeing as thismid year look?
Yeah, so an absolute wild start to the year.
You know, it's been fast and slow.
I can't believe it's it's halfway through the year.
But then you look back and you think about everything that's,
(04:16):
that's kind of transpired and and kind of moved and, and, and
changed. So I think it's a, it's a great
question. As I think about the market, the
venture capital market and insure tech specifically,
there's maybe a few things that give me a lot of optimism around
where where we're at in the market today relative to to
where we started the year. The 1st is probably really
(04:37):
positive signals of of life whenit comes to the exit
environment. And this spans all venture, but
is especially true within the insure insurance category.
You know, couple, you know, we've seen big acquisitions,
Munich reacquiring next insurance for 2.6 billion, you
know, probably the largest, the the largest acquisition number.
(04:58):
That. That was that was that was the
one a lot of folks. Were looking for.
Exactly. Evolution IQ acquired by CCCM
and a deal count in Q1 was the highest it's been for the Inter
Tech category over the past several years.
Some IPO activity, more on the docket here here kind of going
forward. And so, you know, I think all of
(05:18):
that's really positive and necessary for a healthy
ecosystem. And if you think about the way
this business works, venture capital firms need to raise
money. So then they can deploy that to
startups who are innovating in the space and they can build new
things and and innovate in the industry.
But without distribution, you know, that doesn't happen.
So I think it's it's been reallypromising to see some of that
(05:39):
stuff hopeful to see continued activity on that side of the
aisle as well. The other thing that I would
really call out from a market perspective is probably the
continued commitment from carriers to the insurtech
category. And so if you look at the broad
funding cycle, right, like, likenobody knew what insurtech was
like a decade plus ago. And then there was this huge
(06:01):
hype and run up in 2021 where, you know, fifteen, $16 billion
was invested into the category. And then that dropped
significantly. And a lot of generalists kind of
like stepped away. People weren't very excited
about investing in the category.But simultaneously, if you look
at insurance carrier and privateinvestment into the category,
2024 was a high watermark. Q12025 was another high, high
(06:24):
watermark on a quarterly basis. And so I'm really excited about
that stat because it just shows that, you know, insurance
carriers, incumbents, folks who know and understand insurance
are continuing to stay invested in innovation and, and some of
the stuff that needs, needs to change here, here moving
forward. You know, I, I think that's
interesting to you, Brittany, because I think to your point,
(06:46):
like a lot of people follow someof the macro without seeing the
kind of some of those replacement funding metrics.
And there's also this other trend that I see, which is, and
I'm going to like kind of bring it back to funding, which
especially like there was a lot of kind of leverage resource
models, right, in insurance. I mean, we're, we're, we're a
very heavy resource intense, youknow, industry, both capital and
(07:09):
labor. And you know, clearly throughout
the decade, you know, I would say the last 20 years, I've been
focused a lot on, you know, leverage resource models to
business process optimization onshore, offshore, You know, we
look at TPA, you know, like kindof I'll say compartmentalization
of specified and specialized resourcing.
We we've always been doing that.And and then you kind of bring
(07:31):
in AI and a genic AI. And I think carriers in
particular are starting to say, well, is it the resource model I
need to look at? So maybe I need to bring some of
that back in house. But if I bring that back in
house, what capabilities do I need to have in this new era and
include that's gone beyond just digital or automation or
(07:52):
intelligent automation? And so I think one of the
interesting kind of I'll say connections to what what you're
saying would be funding is are you seeing then with the way
that the environment is working,it's like, well, if we start to
think about this as like resource in totality, might we
might need some of those edge scenarios to process this if we
(08:12):
want to bring kind of specialized processing back in
house. I mean, have you kind of
connected it to that yet or is that an early signal?
Yeah, No, I think I think definitely have and, and with
AII mean it's, it's, you know, how do you sell, sell the work
and, and actually tie that into not an enterprise SAS license or
something like that, but the actual outcome.
(08:33):
And we're seeing a ton of companies, I would say building
AI for insurance. I think a lot of them are still
kind of in the workflow automation side of things and
not really delivering on the outcomes.
And that's where I think these need to continue to shift.
I think some folks are focused on it, but then it's like how do
you build a lasting advantage within that category?
(08:56):
And I think you have to have thedata advantage which start-ups
and don't have right like that'swhere carriers.
So it kind of starts and ends with data and like the.
Quality of the policy to have that.
Advantage or something like that.
And so, so like when we're looking at those companies, I
mean there's, there's a ton of them.
We're we're seeing multiple pitches every single week kind
(09:18):
of in and around those categories.
And I think there's some promising concepts, but it's
like, how do you create the defensible lasting edge over
time? And you know, I think it has to
be in in concert with with the carriers who hold all this data,
but they have to be able to unlock it and use it.
So we're not quite there yet. I love that And I'm just going
(09:38):
to, we're not going to get too technical because I want to kind
of make sure we get through all the macro parts, but I just want
to kind of plant a seed. If you and I ever come back and
have this discussion again, I want to plant a seed of
foreshadowing and forecasting here.
Because I think to your point, what everyone seems to be
pitching and focusing on, we would have called it like point
solutions back in the digital day.
(10:00):
And now I will call it like they're like automating
processes with Agentic or AI or whatever.
But where we're really seeing orI'm seeing the missing gap is to
your point, I live where they use outcomes because I'm
starting to frame it as outcomesas a service.
What we're really missing is that fluidity of outcomes and
outcomes as a service, which gets into the layer underneath
(10:23):
the, the, the process. And we're really talking
calculations, We're really talking logic layers.
We're really talking like end toend.
Don't tell me how you achieve the process, like get to the
outcome. And of course, we're starting to
look at techniques of verifiableproofs and all these things.
So I think I love the fact that you use the word outcome and you
and I didn't plan that in advance, but I, I'm starting to
(10:46):
see outcomes as a service becomea very interesting category in
the work that I'm doing and seeing.
And I, I wonder if that kind of correlates into what you're
talking about as well? Yeah, I absolutely see it, see
it going that way. And the, the other thing that I,
I, I kind of think about is, youknow, folks who are spinning up
(11:07):
the tools and, and the tooling and selling those in.
And like, you know, like those sales cycles could be long and
hard versus, you know, folks whoare building the harder thing
and, and like building like techenabled carrier or a tech
enabled TPA or like doing the hard work and enabling it with
technology. And so I think those are a lot
of really interesting models, models as well, which is maybe a
(11:29):
little bit different from, you know, bringing that back in
house. But it's like, you know, could
you partner with a new provider that is doing it with
significant cost advantages at the end of the day?
So yeah, yeah, I love that. Clearly we have even within
carriers, right, we have levels of different, you know, carriers
have their, we'll call it their traditional model, they'll have
(11:49):
their digital model, they'll have all these entities that are
also serving that. So at your point, insurtech has
matured so much over the last 10plus years that it wasn't this
binary scenario that we had, youknow, prior to the evolution
that we're in now. And and I think the M&A activity
is also supporting that, right? Like that's what you're seeing.
So I love seeing that. Well, let's let's move into not
(12:10):
only do you and I share a littlethree letter title PA, but we
also both grew up heavy and deepin life and annuity.
And I love the fact that you arean expert in this area,
Brittany, because I think a lot of people, I don't want to say,
think of a thought, but they don't we, we see a lot of
emphasis on PNC topics and property and casualty thought.
(12:33):
Like, you know, like, I don't know, I always have to say
people, it's not PE, it works very differently, but it, but
it's huge with the, the interestrate markets and the macro, even
the PE interest that we have in the annuity space right now.
So let's go, let's take a littledeep dive into kind of like from
afterthought to edge. And you know, when you and I
(12:54):
first talked about life and annuity and I saw that
innovation map, I really thought, yes, like this really
reframes it. This is really kind of a
pertinent view that we're missing, but what do you think
is still being ignored or maybe overlooked in life and annuity?
Why do people in, I'll call it, in the technology space, like,
(13:17):
you know, people coming in for funding, Why do they often
overlook it or not tackle it? What's your thought there?
And are people waking up? Are you seeing movement there?
You know, I think the short of it is everything is still being
the life and annuity space unfortunately and.
For the poor people that work there, they're like we're.
(13:38):
Like this is going to be the year, this is going to be the
year. But but but the piece like the
market is massive. Like we we know how how big the
market is coverage gap is growing.
You know, it's, it's, it's like not shrinking and capital
continues to be the missing piece in in my book.
And you know, there's a lot of different sources for insurtech
data out there. FT Partners puts out a quarterly
(14:00):
report. And I think I think they do a
nice job of it because they actually break it out by product
line. They don't lump life and health
all together like a lot of otherfolks do.
And when you look at. Gaming is not the same.
Right, right. But when you look at last year's
funding volume, I think there was like over $5 billion that
went into to the category. Again, pretty stable year over
(14:21):
year, 2% went into the life and annuity category.
So 90 million of $5 billion plusflowed into that category.
And so I think I, I look at those numbers and, and there's
some interesting innovative companies kind of on the early
stage of that. So I'm excited to see them
continue to grow and mature. But I'm hoping that we get more
capital coming into to the spaceto fund, you know, some of the
(14:44):
opportunity sets we have here toreally, you know, expand the
value proposition of life insurance and, you know, solve
for the coverage gap. And like, there's so many things
to go after here and, and lessons that we can learn from
the PNC side and apply on on this side of the aisle as well.
So. So if there's a startup founder,
and I have quite a few of them that follow follow the podcasts
(15:04):
and the blogs. If there's a startup founder and
a founding team and they have a discreet outcome oriented
solution, right, like one that'sgotten merits, it's got Tam, it
can get to your point. It has that ability to saturate,
you know, and work with the carrier or you know, and they're
on the cusp. They're like, you know what, we
could go PNC or go life and annuity and they're talking to a
(15:28):
strategic advisor, which a lot. These are actually a lot of the
people that come to me and say, Lisa, how should we approach the
market? You know, what should we do?
And I often look at it and I kind of go back and forth with
when my recommendation to them, like do you want to go PC?
Here's all the present cons. Do you want to go life and
annuity? Here's the present cons.
It's interesting, Brittany, they'll usually gravitate on the
(15:50):
outset towards property and casualty.
And, and I'm telling you, it's like agnostic between the two.
I, you try to say, you know, have you looked at the life and
annuity space? And, and clearly the, the cons
are like there's not central like kind of like a big 5 admin
operating system, right? It's much more homegrown, much
more dispersed. To your point, it's massive.
But I also you talk about, but we haven't spent as much over
(16:13):
the last decade going through, I'll call it like the innovation
fatigue cycles, right? So it's a little bit more right
to coming in with a like a like,like Hindsight's 2020, right?
Like you could come in and say we've learned.
What would your advice be to those founders that have that
equal decision? They're at fork or why in the
road? How would you advise them to
(16:33):
think about it? Because I know there's no
declarative with one they take. Yeah, You know, I, I think, I
think you definitely could go either way.
I think the, the challenge with life is, you know, the long
tail, you know, complexity, there's so many different
permutations of products and stuff like it's, it's so
different than a lot of things that you see on say like
personal lines and, and, and that side of the house.
(16:53):
And so I think it is diff. I would probably point, you
know, I'm going to be a little bit biased in this answer, but I
would point to market opportunity.
I would point to just the potential, a competitive
landscape in itself, right? Like there's just fewer
companies going after a pretty big prize at the end of the day.
And so I would definitely tell them that and ask them to call
(17:16):
me. I was going to say, and they
could call Brittany because doesshe need American Family's
venture fund? But she has a big background in
life and annuity. And so I think, I do think it's
important that we, we often talkabout inclusion for new entrants
into. So if you're coming to solve a
problem, how we, how we don't isolate people with being like,
oh, we're insurance you, you know, but I think life and
(17:39):
annuity we're also even more exclusive.
So I think there is some inclusivity there that's needed
because it isn't intimidating. Like I, I literally caught
myself too two weeks ago, Brittany, someone was working on
a technology solution for reinsurance and they were
thinking property and casualty. And I caught myself saying to
them, like, you have no idea howmuch more infinitely complicated
(18:02):
this is for life. And they said why?
And I'm like, well, you have to regenerate the calculation for
every single cell, for every single policy for every single
movement from inception to date.And they're like, oh, and I'm
like, that's not the way it works in PNC, right?
And so I, I caught myself almostunintentionally like kind of
(18:24):
like saying it's so much harder.And to your point, it is, but I
think the hard parts are where we have actuaries.
The hard parts are where we havereally good modeling.
I don't think those are the hardparts in terms of, you know,
maybe bringing technology to partner with that.
Do do you or do you see that as being like like limiting?
Yeah, I think, I think it's a lot of populations.
(18:47):
I think that's a good way to putit.
And it's math and that's solvable.
I, I do think, you know, we, we sometimes have a debate amongst
our team around, you know, who are the right builders for
things in different categories. Yeah.
And whether you know, that should come from inside the
industry or, you know, outside the industry.
And I think especially within this category, you don't have to
(19:09):
come from inside the industry, but you need to hire someone who
knows their stuff. It, it can be so complex.
And I was, you know, I, I was talking to someone yesterday
who's, who's building in the LTCspace.
And I mean, it was such a fun call.
It ended up going like 20 minutes over and, you know, I
learned all sorts of new things and I've been like studying the
(19:30):
space for 10 years. So I do get that intimidation
piece, but I don't think anyone's an expert, right?
Like there's, there's, there's so many pockets of, of what it
all means. And that's part of the fun of it
all. So.
I totally agree with you and I think the reason why I 'cause I
didn't even go into life and annuity to like I would say much
later in my career, I had a benefits background, which to
your point health is not the same as, but I had a benefits
(19:53):
background, but mainly PNC. But then I, I started my
corporate world always in life and annuity.
My entire corporate career was life and annuity.
Never, never PNC my that was more my consulting upbringing,
my M and a background. But when I went into it, I fell
in love with it because of the complexity of the financial
modeling and because of the complexity of the capital
strategies connected to the financial modeling.
(20:16):
And so I agree with you entirelythat it's really, really, really
important to have somebody that understands because you won't
have any credibility with those carriers if you don't understand
the complex. That's right.
Like and I'm not saying you haveto be able to RBC.
The like, there's so many facetsthat you have to kind of balance
(20:39):
when you're when you're thinkingabout all that stuff.
And yeah, but it's, it's fun to fun to build those muscles and
you know, it, it, it's never dull.
So. When you're typing, you know,
I'm kind of interested to see with the AI agenic waves and
kind of these foundational substrate layers that I kind of
predict as like investment needs.
(21:00):
I'm kind of interesting to see how much we can learn from scale
of insurtech solutions and thinking about life and annuity
Brittany. So I, I have my, my second-half
of the year watch on that and I know some, some leaders that are
trying to build in this space. I'm very excited about it.
So let's let's now flip to founders.
So, you know, there's a lot about founders and you alluded
(21:23):
to it like certain founders, like can they build certain
types of companies? And you know, I think there's a
different type of an applicationfounder than there is an
infrastructure founder than maybe P&C life.
You know, there's all sorts of different types of founders.
But a lot of times I think we fixate on the deck and, and even
maybe the the blueprints of whatsomeone says the deck and the
(21:43):
numbers and the deck should looklike.
But what are the more subtle cues that make you like lean in
or maybe even think? I just I don't see, and it's not
personal, but I don't see this being like viable, like at this
level. What?
What are those subtle things that you look for?
Yeah. So I I think this is, this is a
great question because regardless of how good the idea
(22:06):
is, what's happening with the market, all of the above it, it
comes down to a team's ability to execute.
And so, you know, such heavy weighting is is placed on that.
And I've learned lessons over the years.
You know, I haven't always gotten this right, you know,
been fooled by charisma or, you know, different elements where I
have gotten it wrong. But you know, I have, I have
(22:27):
learned quite a bit and there's a few things that that I'm
really looking for when I'm evaluating teams.
You know, one, I think you have to have this strong mix of the
seller and the builder and and those capabilities.
And, you know, sometimes that's in a founding team, sometimes
that's in, you know, a CEO and bringing on like, you know,
your, your first, you know, really strong technical hire
(22:47):
that's, that's highly committed to, to the business.
But you know, that front person,they have to be able to raise
capital, present a vision, and then recruit really, really
talented people into the business.
And then, you know, the technical person has to be able
to actually execute and, and, and, and get the stuff done.
And so I think too often there'sfolks that are maybe a little
(23:07):
too similar in, in those regardsand don't don't have enough
balance to get both of those pieces right.
And I think both of those piecesare critical.
So I think that that that's one side of it.
The numbers accounting in me, I,I love strong grasp with the
numbers in unit economics. There's been times where that
kind of stuff has been punted and that doesn't give me
confidence in someone's ability to build a long lasting, you
(23:29):
know, scalable business. And then I think just high
trust, high integrity, low drama, you know, in it for the
right reasons and, and high ambition.
So a lot of times there's folks who are building things that,
you know, don't necessarily needventure capital funding and
could be a great business through a certain pathway.
But the, the type of opportunities we're looking for
(23:50):
are, you know, like billion dollar companies.
And so you kind of have to like close your eyes and, and like,
is this person in it for the long haul?
You know, are their ambitions aligned with like what we need
to see happen from a fun math perspective and making sure it's
a mutual fit on that, on that regard too?
You made me laugh when you of course, the billion dollar goal,
(24:11):
right? And when I first left my
corporate roles and I started working with startups I like was
puzzled. Genuine.
I, I will admit this genuinely puzzled that every financial
deck I would see put together was a billion dollars divided by
So it was like 100 million in ARR right times times a multiple
(24:32):
of 10 back in those days, you know, and, and it was 100
million ARR like, you know, maybe that goes up or down
depending on your multiples. And it was always divided by the
years to get there. And I'm like, so like this is,
this is not a financial model and, and the numbers were
derived or contrived. And I don't mean unethically.
(24:53):
It was like they knew that was the mark.
And so the like, I was like, well, genuinely, Brittany, my
accounting CFO background, I'm like, but that's not a financial
model. So how do you, how do you peel
that apart? And then the second layer to my
question for you is I grew up asdid you Brittany, with true
Financials, balance sheets, income statement statement, the
(25:16):
cash flow. And I find since I started
working with startups that they don't use the concept of
financials. They use the concepts of, I'll
call it maybe cash in and cash out.
They're not even comfortable with like like true forecast,
true accrual based financial statements with, you know, like
(25:37):
amortization, depreciation, likeall those things.
And, and clearly most startups can have ACFO that thinks like
this until they're well into like maybe BCI, don't know,
depending. So how do you tease that out?
Because I found that my own level of like oil and vinegar
and water and I'm like, whoa, how does this work?
How do you see that? So 1, I think having a strong
(25:58):
understanding for the way everything flows is really
important because like you know,there can be things that are
positioned certain ways that, you know, maybe something is
capitalized as R&D or something like that, but it's truly cash
out the door, right? So I do think like in Star, like
cash is king, you know, your jobis to not run out of money and
(26:19):
either, you know, turn to profitability or hit a really
significant valuation inflectionpoint and be able to go, you
know, raise significant capital to pour, pour fuel on the fire.
And so I do think having a good grasp on the real cash burn
number and you know how that's fluctuating and, and all that
stuff is, is super important in,in that regard.
I've seen all types in terms of like the savviness at all stages
(26:43):
as well. But there's a couple companies
that really use their financial plan as a management tool.
They are really using it to drive decisions and I love that.
So probably no, no surprise in in that end, but they are, you
know, really on top of it from, you know, what this hire means
to my margin then how it's allocated and all that kind of
(27:03):
stuff. And I would say, you know, they,
they get to the point where you know it, it truly is like
helpful to them in in their decision making.
And I think that that's a good foundation for success as you
continue to mature as a start, because I tell you like growth,
growth stage investors and as you continue to mature as a
business, that's going to be required.
So the lens that I always come in and think about it is like,
(27:23):
OK, if I'm coming in a seed stage company, how can I help
provide guidance to like what a best in class Series A company
looks like from everything from the financial models, the
statements and just like your overall KPI dashboard and stuff
that you're delivering. And then same on for, for
companies at at later stages. And so, you know, never, no
(27:43):
one's going to be perfect at, atthe beginning and you shouldn't
either because that's probably an inefficient use of a
resources when you're trying to survive, survive another day,
right? So it's, it's a little bit of a
balance and, you know, progress towards perfection.
Not not necessarily. Assuming you're you're, you're
going to be there day one and. Well, I think you brought up
some really great points too. I think like unit economics
(28:04):
margin, I think that's often again in this like divide by
yeah, it's like top, you know, and, and, and of all interest
people for anybody listening, wereally believe in the total unit
economics. It's exactly like our business
is a capital business, not a balance sheet or like just an
income statement. We're really we look at capital
(28:25):
and strain on capital. So in particular when you're
trying to partner with or sell into or get investment for
insurance where we of all peopleare not just top line focused,
we're we're unit economics focused.
And I, I think that there's often so much focus on the, I'll
call it the bright line of ARR that people forget unit
(28:47):
economics. And Brittany, I remember having
a discussion with a founder thatwas, you know, putting clients
into revenue activation, so, so into production.
And I was like, but they, but that client's not paying you
enough to cover, you know, the cost of production, the cost of
goods sold, if we just keep it simple.
And it was like, but I need the ARR And I'm like, but your unit
(29:09):
economics aren't supporting. So you're actually negative and,
and clearly like I see it that way.
I do understand there's there's stress to get top line to get to
A and when do you think this like unit economics pay like
kind of has to pay the piper in the journey from maybe C to A to
B? Did you have any guidance for
(29:30):
people? So I think it, it matters so
much earlier. I mean, I think this growth at
all cost mindset, that's kind ofwhat got everyone in trouble in
the 1st place, right? Because everyone was growing as
fast as humanly possible when they didn't even know what their
cogs were. So exactly what you were saying.
And then that backfired, right? Like, like terrible loss ratios,
unsustainable financials, like, you know, bottomless money pit,
(29:52):
right? A lot of people have learned
from that. And I think it's more about
measured, measured growth and, and, and being smart about that.
I see it as a red flag, let's say for like a, a new full stack
carrier. That's, that's, that's emerging.
If they grew like huge overnight, I would be very
(30:12):
worried about that because you don't know what's in that
portfolio. You don't know, you don't know
what the underlying risk is, right?
And so you have to be measured in your growth at the end of the
day. And I think a lot of folks are
much more oriented and focused on that today, just
understanding how these businesses will be valued at
exit. And, you know, I think just
(30:34):
having that as a good foundationbrings some good practices in
into the into the space. So we talked about this next
section is really like inclusionand I know you spend a lot of
time as you know beyond optics with diversity.
And we talked a little bit aboutkind of maybe lines of business
or areas within insurance to getfunded.
But you know who would you say is still not being funded?
(30:58):
What's the blind spot costing us?
And do you think that there is still a blind spot in investing?
Yeah, there is is the short answer.
I would say significant funding gaps for women, people of color
continue to persist. A very small portion of venture
dollars are are flowing into that.
I don't know what the actual percentages are, but I don't
(31:19):
think there's been much movementhere over the past past number
of years. And this just represents a a
huge opportunity. So, you know, I think you've
probably seen all the all the same studies I have, but you
know, diverse teams outperform and I think not necessarily
building with those folks in mind leaves a lot on the table
(31:39):
at the end of the day. So at one time I saw, and this
is this is dated, but I I assumethat this probably holds true.
But Oliver Wyman put out a report that showed underserved
women represented, like, the most significant market
opportunity in all of financial services.
It was something like, you know,a $700 billion annual revenue
(32:01):
opportunity by serving women in parity with men within the
financial services category. And life insurance was actually
like the biggest bucket within that report.
And so demographic shift, there's all this impending
wealth transfer. You know, there's differences in
mortality. More women are making financial
decisions. I just, I just think that
(32:21):
there's a big prize to be won there.
And so again, maybe another self-serving pitch for me.
But if if you know you're you'rea woman building an insurance, I
would I would absolutely love tolove to chat with you and.
And to serve the underserved in life hit Brittany up.
I love that. I just saw an ad and I won't
name the company, but I and and I'm not advocating for the
(32:41):
company, but the ad said be the mom who has life insurance, be
that mom. And I was like, I was scrolling
through social and I was like, that's such it it it's actually
getting interestingly at what you just talked about and and it
it made me pause right, like, and I just thought that's
interesting. I had never seen that before,
(33:02):
Brittany. And I just thought recently, no,
I think. I've shared like I'm a life
insurance beneficiary. So like, I think you're crazy if
if you know, like we need to be making these these thoughtful
decisions for our families. And I love that that's that's
very much on the nose and, and. I really liked I, I kudos to
that unnamed marketing team, butI was like really impressed with
(33:23):
that. And we need a lot more of that.
And to your point, we need a lotmore solutions.
All right, so let let's move into I wanna ask you a couple
questions before we get into ourroundup.
Let's go for rapid fire. So what is, you know, one deal
that you passed on that still stinks?
Chime bank series BI think the entry point was sub a hundred
(33:44):
100 million valuation and what they just IPO for close to 12
billion. So that one, that one stings a
little bit. If you were an inventor, what
would you be doing? You know, probably something
golf related. I love the game of golf.
It's it's kind of what my familyand I, I do together, played in
college, probably teaching kids golf.
(34:06):
I love that and I can totally see that.
By the way, you should have comeand hung out with me when my
daughter was over at Saint Andrews.
We could have played around. Next.
Time. What's the most underrated risk
or opportunity that you have your eye on right now?
You know, we've been spending a lot of time on reimagining long
term care and aging in place. You know, I think huge risk to
(34:28):
society with all the demographicshifts, big opportunity for
innovation there. Yeah, yeah.
I love that one. I was personally doing a lot of
work on that even five years ago.
What's the most overrated trend right now?
AI workflow automation tools point solutions can.
I see like an amplification exclamation part on I.
(34:50):
See to stand up and and, you know, unfortunately easy to be
replaced. I think so, yeah.
Yeah, not, not a lot of moot there, All right.
What's one team or teams that you're watching like in terms of
founding teams? Yeah, you know, I will, I'll
give a shout out to actually oneof My Portfolio companies.
So Alexander, my Mysore, she's CEO and founder of a company
called Alex that is they're focused on tech enabled estate
(35:13):
settlement and facilitating thismassive wealth transfer that's
that's underway. And they, they just announced a
great Series A this week. Super excited for them and
they're just off to the races. So rooting them on and and
excited to see what comes next over there.
I love that all around. OK, so we're getting to the end.
Thank you all for hanging in. Even though we started this
Cpas, we we got a little spicy in the middle.
(35:35):
OK, the the Hallmark sign off isthe call to action.
Say Brittany, what's one thing that you would ask everyone
listening today to start doing, stop doing and continue to do
over to you? All right, let's see here.
I tried to leave this one a little bit unscripted and let's
(35:57):
see, I would say, oh, this one'seasy.
So I would say start investing more capital into the life and
annuity space in in sentence on that one.
I think, you know, we spent a lot of time talking about that
today, but a lot of opportunities there, some really
interesting companies getting started.
So, so you know, let's let's seeif we can beat 90 million
(36:18):
deployed into that category thisyear.
All right, anything that you want people to stop doing?
Stop. This is this is a little self
reflection on myself. When I kind of did my own mid
year assessment. I would say stop with all the
meetings, you know, have more ofa bias towards action.
I have personally started to do more of that and just more ad
(36:38):
hoc picking up the phone, you know, no one's no one's getting
annoyed with me yet, but it justfeels more high energy, more
fun, you know, and and more productive at the end of the
day. And then continue, I think I
would just say continue it like kind of where we started with,
with like carriers continued investment, say continue
investing and partnering with startups in a mutually aligned
(37:00):
way. And you know, I've seen so much
growth here where we've moved onfrom the theater.
I think carriers and startups alike have kind of matured in
the way they partner with one another in finding, you know,
that mutually valuable points ofconnectivity and really, really
doubling down on some of those focus areas.
I love that and Brittany, like always, always, always, whether
(37:23):
I get to the benefit of being onstage with you or the
opportunity to have you one-on-one on the podcast, I
absolutely take copious notes. I love learning from you.
I love seeing you out there in the industry.
I mean, you provide not only just perspective, but a deep
playbook rooted in lots of experience, and you've always
been so open, warm, and welcoming to helping others.
(37:46):
So if they want to reach out to you and pitch something, and
they meet some of the categoriesthat you shamelessly plugged,
where should they follow you other than LinkedIn?
How should they hit you up? You know, I would just say
e-mail Brittany at amfamventures.com.
I am no problem with with the cold cold outreach on my end so
LinkedIn or OR that works great and feelings are mutual.
(38:08):
This was a lot of fun Lisa and and big fan of yours as well so
really really appreciate the time today.
Well, thank you, Thank you so much for being a guest on the
Hot Seat and for everyone listening.
We could not do this without you.
So thank you all for listening, for caring, stay curious, stay
informed, and stay plugged in until next time.
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