The massive amounts of capital flooding Israel’s high-tech scene is not as surprising anymore. Just yesterday an Israeli FinTech startup raised $425 million, and nobody really flinched. Now, usually these companies are industry veterans (relatively) with familiar entrepreneurs, an established product, dozens if not hundreds of paying clients, and a handsome ARR, behind them. And with rounds like the above happening on a monthly basis, you figure that these massive sums of capital will find their way to early-stage startups as well. Today (Tuesday), Early-stage Israeli startup Insurights announced a $22 million Seed round, led by Group11. The round also saw participation from Good Company, Cresson Management, and Insurtech Israel.
Automated systems replace medical forms and customer service calls
The Insurights system -- Zoe -- is a kind of personalized virtual health counselor, which leverages AI (of course) to help realize the entire scope of options your health insurance provides. Something that is quite complicated to achieve in the incredibly complex American healthcare system. This is how the system can provide employees with clear answers to their inquiries into their medical rights, by analyzing various coverages offered by different companies and corporations. Employees can easily discover their out-of-pocket costs depending on their coverage. In addition, users can find recommended payors and suppliers and soon be able to schedule meetings through the app. The company explains that this will help save people time and anguish from sifting through pages and pages of insurance and medical records or going through a deep dive into private medical history with a strange customer service representative.
“There were more than few VC funds that we had to keep out of the round”
Insurights was founded by Guy Benjamin, Ben Nagar, Dr. Elad Ofir, and Ben Goldenberg, and employs a team of 25, with half of them based in Israel. While chatting with Geektime, CEO and co-founder, Guy Benjamin, explains why a startup at such an early stage needs $22 million and if he even has a chance to recruit talent while all the big Unicorns are hunting too.
Why raise so much capital at your Seed round? Obviously, at your stage, you don’t really need $22M?
"There are several reasons; we’re aiming to disrupt a huge market, and for that we need quite a few resources, including, but not limited to, people, systems, etc. In today's competitive talent market, we need to compete with other companies in order to bring the best people to the company. Although we represent a good cause (helping employees be healthier) which helps us in recruitment, we still need enough resources to bring in the heavy guns. In the end, we are in a very special situation with the troves of opportunities in the market today. As a company, we always have to plan for different times as well, this funding helps us prepare for other extreme situations as well.”
There’s this feeling that Seed rounds are becoming harder to raise with the Unicorns drinking up all the money. And then you come in with a round like this…
“The truth is, our experience was the opposite, the round was oversubscribed and there were quite a few VC funds that we had to keep out of the round. I think, when there is a good idea, with a very clear demand and a strong team, the funding process is not really that complicated - the only thing is how you tell the story and show how your idea will solve the need, and why your team is suitable for this task. "
No setbacks in the talent acquisition department? After all, you’re a young company in a sea of Unicorns and NASDAQ traded giants?
"We are a company with a very clear goal - we want to help employees be healthier. This is a super important goal that in itself attracts a lot of talented individuals. We grew from 6 people to 23 in a month and a half and I feel like every person we wanted at the company joined in the end, we didn’t have to compromise on our HR scouting. In the coming year we will grow to over 50 people and this goal, which gives a kind of added value to the position in the company, helps us every day in locating, recruiting and retaining people. I am very proud of all the people who have joined Insurights over the last two or three months. It’s clear to me that they have other options, but they chose us as much as we chose them. It is this mutual choice that helps expand and preserve the significant growth we have made so far."
“Guy, Ben and the founding team at Insurights have an exceptional understanding of what is needed to solve one of the most common problems in U.S. healthcare,” said Group 11 Founding Partner Dovi Frances. “With Insurights, employees will no longer need to spend hours on the phone with insurance reps. HR managers will spend less time resolving employee benefits issues and deciding which healthcare plan to offer employees each year. CFOs will ultimately better manage their immense employee healthcare costs. We are thrilled to support Insurights' vision and join them on this journey to radically change how employees access and understand healthcare benefits."