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Hello, everyone, and welcome to a new episode of Purple
Ponderings with Pankaj. And today on our show, we have
Aviad Pinkovezky from Hippo, who’s got some very
interesting updates. Earlier this morning, they

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announced the acquisition of Shelter. So I, being in
this space, I’m very, very pleasantly surprised, and
also very excited by that announcement. So we’ll talk
about that with Aviad. But just in case we have viewers

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who have been, who have not heard of Hippo and, and
don’t have may or may not have heard of you, a little
bit of your background, a little bit of your background
with before Hippo and with Hippo.

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Awesome. Yeah, thank you for sort of Pankaj for having
me. It’s great to be on Insurance Nerds again.
Definitely a pleasure. Yeah. So for the viewers that
are not very familiar with Hippo let me give like the

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high level description. Hippo is reimagining and
reinventing home insurance. We believe that home
insurance should not just be about reacting to a
disaster once it happens, but it should also leverage

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technology and services in order to prevent as many
claims as possible. In addition to that, we also put a
lot of effort into streamlining the process of getting
home insurance by pre-filling the onboarding experience

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with tons of data that we source from different places,
customers can essentially get a quote, within 60
seconds including on their mobile phone and complete
the purchase within just a few minutes. They can,

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complete a purchase on their phone, on their laptop or
if they want to have a human interaction, they can also
call or chat with our licensed insurance agents team
which can provide with this service was the personal

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service that is needed. Hippo is currently writing
business in 20 states. We are currently we have offices
in California, in Texas, which is in Dallas and Austin.
We’ve been around selling policies for two and a half

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years starting in April 2017, in one state, now we are
in 20 states, we were fortunate enough to gain a lot of
momentum and customer traction, which led to
fundraising that resulted in an amount of $209 million

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to date. So we are now working very hard to make sure
that we are able to expand nationally to become a
substantial, big player in the home insurance industry
in the US. A bit about me. So I’m the Chief Product

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officer at Hippo. I joined Hippo very early on right
after the seed round as the first non-founder employee,
leading the product for the company. Been with the
company since that and it’s been a great, amazing ride,

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turning this thing from a concept into a fast growing
insurance startup that was able to gain so much
momentum and make a difference in so many people’s
life. I don’t come from the insurance industry. I’m a

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newcomer for that. Although you could argue that
spending three and a half, almost four years at Hippo
is equivalent in dog yields to almost 30 years of
experience because of the pace. But seriously, though,

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I know coming from the insurance industry. In the past,
before joining Hippo, I was doing Product Management at
LinkedIn. Prior to that, I did my MBA at Stanford at
the business school, Graduate School of Business at

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Stanford. And prior to that, I served about 10 years in
the Israeli military and military intelligence. So
quite different background know the typical insurance
background.

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Yeah, I would say so. But that’s a very interesting and
very, very deep background, that you have Aviad. My
first question to you is that Hippo was growing really
fast. If I look at your own story in terms of you

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started three to four years ago, to where you become
one of the, what do you think, has been the drivers

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leading to your success?

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So from the very early days, we had the mission to
build a customer centric company. And I’m saying the
company because it’s much more than the online
experience. We wanted to build a holistic, customer

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centric experience that would be present also within
our online experience, but also when people call us or
when they have any question, and of course, when they
have a claim. So that was the mindset that we had, you

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know, set out with to build the company. And this has
been kind of our North Star that guided us in all the
decisions that we made, and people responded well to
that. The fact that we are able to provide quote and

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bind a policy so quickly and so easily. The fact that
we worked really hard to modernize the underlying home
insurance to make sure that it covers what people
expect to be covered in 2019, such as home office

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equipment, service lines, Equipment Breakdown, for
HVAC, and other system in your home, we really work
hard to make sure that people get the coverage that
they expect from their insurance company. And then we

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also made sure that the quality of the service that we
offer our customers or call us we whether it’s about
the billing question, or want to ever say to complete
the sale, or of course, when once they ever claimed, we

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made sure that this would be like a top notch
experience. And we did it in how we build and trained
the call center and our and our staff. I would say
that, you know, we are extremely proud of many things

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that we that we accomplished, but I think the metric
that I personally is most excited about the most proud
is either NPS Net Promoter Score. The standard in the
industry’s about 31, we were able to gain very quickly

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in NPS, it is around 75. And again, this is just
because we were very, very focused on creating the best
customer experience from any perspective

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Got it, that’s not super helpful to know. So let’s come
down to now, the announcement this morning of acquiring
Shelter. And the brief reading that I had it was a
pilot that you did you found some insights from that

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pilot and you’ve felt compelled enough to buy them as
opposed to invest with them or be a you know, sort of a
commercial partner. So what led you to that decision
and what was driving that?

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So let me start by taking a step back. From the very
early days of Hippo we knew that services will play a
big role in creating in pursuing the vision that we
decided to pursue, which is how to modernize the home

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insurance experience and how to make it a preventive,
proactive experience for the customer, not just
reactive. And in our mind, there are three layers to
that vision to making this vision a reality. The first

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component is the insurance space, which is where we
started from. So I mentioned how we modernize the
insurance policy. Now we made a process of buying
insurance much more easy, much more easily done, and so

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on. This is of course, and never ending effort. And
we’re always finding new ways to improve and and to
make this experience even better. Second piece was the
IoT. We knew that it could play a big role in the

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customer experience and in reducing potential losses
for customers. And this is also a strategy that came to
life as well. The third component is exactly the
service layer, which is how we can provide preventive

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services to customers in order for them to take better
care of their homes on an ongoing basis. Prevent losses
and catch issues that could become serious issues early
on. So in the past two years, we actually ran a series

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of experiments, partnerships and different trials to
see what would resonate best with customers and what
will be the market reaction to that. Shelter has been
one of the partners that we worked with during this

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time. And we were very positively impressed with the
amount of impact that they were able to gain and from
the quality and the consistency of the experience that
they were able to deliver to the customers. Since this

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is something that is core to our strategy, we made a
decision to acquire them, because we believe that
having them as part of the Hippo team would allow us to
expand scale and scale this partnership. Now No, no

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longer partners. You know, it’s part of the offering
but basically to scale the service and to offer it to
all of Hippo’s current and future customers. We believe
that this is the path that insurance should take in

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providing additional value to customers not just
responding to claims after they happened, or dealing
with customers when they need to pay. Those are the
essentially the only two points in the policy in the

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policy lifecycle that existing insurance companies are
interacting with the customer. We think it’s not
enough. We think that customers expect more, and can
benefit much more just to indicate how valuable it

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is…two interesting data points. One is the very
positive reaction and customer satisfaction score that
we got from customers during the pilot phase with
Shelter and the second one is that in over 50%, over

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50% of the issues that we found, had the potential to
become a substantial claim unless they were handled
first, which indicates that there is a lot of value to
create the service that allows you to detect leaky

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pipes early on, change the batteries in your smoke
detectors, make sure that your HVAC filter is is fresh
and clean and cleaning drains, and so on and so on.

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Got it, got it.

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You know, you mentioned the two step strategy, right
IoT step one, and now services. Step two, I want to go
back a little bit to the first one and ask you a little
bit about in the rollout for the IoT strategy, right

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for the prevention in even the customer engagement
angle, what were the barriers? What was the challenges,
if any that you know, faced?

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No, that’s a good question. You know, we started to
think about it back in the early days of people circa
2016. Back then, when you talk to people about IoT
devices, the initial reaction was devices like Nest,

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which are, which is an amazing device, I have one at my
home as well, but it’s a bit more expensive. It
requires professional installation. It’s a bit more,
you know, it’s it’s more of a demanding customer

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experience. So one challenge was that we had to partner
with more nimble players that offer DIY kind of
offering that are very easy to install and also, you
know, affordable, so they can be delivered and

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distributed at scale to customers. So this is one thing
so right now we are partnering with Notion, which is
exactly that. It’s a it’s a kit made of hub and
multiple sensors to serve multiple purposes. Very easy

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to install, takes a few minutes, all you need is a Wi
Fi and a smartphone which is very, you know, it’s not
it’s not a barrier. So that was one thing that we had
to address. Second thing was that, you know, we had to

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obtain regulatory approval to embed this offering into
our insurance policy. And obviously, that takes time.
But we are very proud and happy with this achievement,
which allows us to provide our customers with

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additional discount, once the device is activated, and
we are able to read that the device was activated, we
don’t get any data about what is going on in customers
homes, by the way, this is something that is very

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important to clarify, we just get the signal that the
device is active so we can grant the discount. And the
third one, you know, we thought that there might be
considerations on privacy. So we made sure to address

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it in a very upfront and transparent manner on our
website and throughout the different communication
points with our customers. And yeah, for some people,
you know, there is a consideration along those lines,

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but you know, our activation rates For those kits is
north of 70%, which is something that we are very happy
with. So it is an indication that the end of the day,
the vast majority of customers feel comfortable with

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getting this kind of service that allows them at the
end of the day to take better care of their home and
also benefit from an additional discount on their
homeowner policy.

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Got it. No, that’s, that’s that’s a great answer.
Question for you is based on that strategy, right? In
adoption. You got your percentages, high…what’s the
next phase of that strategy? What what’s coming? What’s

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more, coming more? I know you guys are very, you know,
protective about not sharing a lot but high level
insights.

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Let’s say that I would ask you to stay tuned. We are
constantly working on making sure that the offering
that we provide to our customers is best of breed. And
provide the best service and the best coverage and

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value for our customers. We are very, very happy with
what we achieved to date with the existing partnership
that we have. And we are always looking for additional
ways to provide more substance and more value to our

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customers along those lines. And I think you know, this
industry, the IoT device industry, and the connected
home is still very early days for this industry. I
think the potential is huge. And we believe that there

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is a huge amount of value to be created and to be
delivered to customers by doubling down on this down
this path. So So stay tuned. I think that you will find
some interesting updates from us throughout 2020, which

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I’m sure going to be a very exciting news.

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Very exciting. Yeah.

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Fantastic. So, you know, one question just related to
that is that because you mentioned that there is still
amazing amount of opportunity on them in the market,
right? Just for the industry as a whole. And but

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I have I have noticed that

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the time it takes for adoption for the industry is
still in insurance is a lot. What do you think, from
your view? are the reasons for it? And what is the one,
you know, if you had wish to make, like, if I could

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change the one thing which will help us all, what do
you think is that one barrier that you would like to be
removed?

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It’s actually very difficult to summary to one barrier.
I think it’s a complicated situation. I think some of
it, at least up until recently was a regulatory
barrier. And you know, it’s a it’s a process, it takes

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time. But that’s one thing. I would also say that, from
our experience, and from our observation, it takes time
for the insurance companies to run and to implement
those changes. It’s so much more complicated when you

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have a huge existing book of business. I think for us
as a new comer, it was much easier to launch this
program to begin with, with a clean slate, almost like
a clean slate and we started to implement this program

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very early on. And to scale the business with it. I
think it’s a bit of a different game. It’s more
complicated, technically, logistically, operationally,
to introduce it once you already have a huge existing

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book of business. And I’m sure that also is something
that plays a role you know, in in the decision making
process within large companies

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Got it. I would say that what you just described are
probably from from one lens competitive advantages
because you’re a startup you can take faster decisions,
you have a clean slate. So you can really, you know,

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sort of rewrite or write your, you know,

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there are advantages of being a new entrant into the
into a market Yeah, usually, people think it’s a
disadvantage being small, but you’d be surprised how
much value you can create by just being nimble,

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focused, and not being constrained by too many, if any
legacy considerations.

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Gotta got it. But I’ve got to tell you, that I, you
know, you talk about competitive disadvantages being
small. And one of the things in the industry that I’ve
sort of, you know, observed is a lot of the carriers,

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incumbent carriers, right, large or mid size or
whatever, still have not moved as much as we would have
hoped, right. Sadly, the people on the other side of
the table with the technology, I’m sure if there was

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some device manufacturers here the I wish there were
more and more demand for it. What do you think is the
reason for for that? I mean, what’s your perspective on
that whole?

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You know, I don’t feel comfortable commenting on their
behalf and sure that they have their own reasons.
Usually to be completely honest, what we are very busy
on a day to day basis is not looking at the

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competition, but focusing on how we can deliver more
value to our customers and look for the best
opportunities within the IoT space within the services
space like was demonstrated with the acquisition offer

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that the acquisition, completion that was announced
today. And of course, with improving the underlying
insurance policy and the online experience. At the end
of the day, we have a vision to make insurance, a

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reactive service, sorry, turn insurance, formerly
active service into a proactive service that could help
customers to prevent claims and to mitigate issues that
arise while they you know, and to make the

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homeownership much better experience and this is our
focus area that we are very busy with on a day to day
basis.

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Fantastic. All right, well now get into a little bit of
a different space in terms of just wanted to ask you
have you had your you know, constantly probably
traveling very busy with your work. But if you have to,

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if you have some time to do something, you know, what
are the things that you like to read or other people
that you follow a little bit about where you get up to
speed, not a lot of time left in the day, to be honest,

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you’re right. It’s a very

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demanding, you know, job being part of a fast paced
startup and I also have a family so that also takes,
you know, a lot of my time, one thing I get, I try to
make on a regular basis is to be involved in my kid’s

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life and to take them to school in the morning. And to
put them to bed at night when I’m when I’m not
traveling, to do homework with them and to try and
spend as much time as possible over the weekend. So

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this is one thing that is a big priority for me in my
life. Other things that I’m doing on a regular basis is
making sure that any given time there is a book that
I’m reading it Trying to find a mixture of leisure and

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business related. Right now I’m reading a book about
product management. So it’s on the business side, the
one after it is actually supposed to be like a
fictional book. So I try to find this balance. But at

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this point in time, this is pretty much what takes my
time. There is also of course, I almost forgot, but I
also try to cook as much as possible, mostly barbecuing
over the weekend, to something that I enjoy doing.

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God That sounds that sounds good. By any chance you
happen to know the name of that book, if it’s any good,
like, leaders, readers to know.

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00:20:40,109 –> 00:20:52,979
Yeah, so the name of the book is inspire. I forgot the
name of the author, you can easily find it. And it’s a
book that explains I think, in a very accessible,
straightforward way the concept of product management

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also for people that are not very familiar with the
concept of product management, in tech organization,
but also providing A different additional layer about
what are some best practices that are being used by

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fast moving, agile and efficient teams? So it’s pretty
comprehensive. Not a short one. But yeah, recommended.

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Got it. Got it and sort of the one last topic on this
subject was a question on the subject. If you were
listening to and you mentioned that you are, you know,
listening to our podcasts and, and webinars, etc. Is

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there any one person that you would like to hear from
and get on the show? If someone comes to your mind that
hey, bonkers, go interview this person. I’d like to
know what they think about this.

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I need to think about it. But I would love going back
to your question. I think it will be very interesting
to understand incumbents perspective on the shift on
the shift is that occurring with customer expectations?

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Obviously this is what we are dealing with. This is a
focus area for us. I think it will be great to
understand how it’s being perceived by incumbents, and
decision makers over them. We have our own theories and

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policies. You know, at the end of the day, we’re mostly
busy with executing against our objectives and goals.
But yeah, it should be very interesting to get this
perspective as well.

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Any carriers you want to name that I should try? All
right. Okay.

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Understood, understood. Well, that was very helpful.
area. I think we captured a lot of thoughts from you on
this topic. I’ll let you say some final words for our
listeners, and then we can wrap up.

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Now listen, thanks for having me. I have to say that
the last almost four years it’s been a crazy ride. It’s
been such a great pleasure. And I think the most
gratifying moments that I’ve had during my time at Hippo

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was launching the product that we build to market and
starting to get customer testimonial. feedback to
really understand what is the demand in the market for
what we are aiming to deliver. That is both

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heartwarming, and also very satisfying on a
professional level. And it’s been a, you know, it’s
been a great ride, and I just can’t wait to deliver all
the great stuff that we have in our pipeline next year

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and beyond.

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Excellent. Thank you. Thank you Aviad. Yeah, thank you
for your time today. And I think our listeners are
finally heard from the man who’s built a product that
Hippos you know, grown on. And so we’re looking forward

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to many more new services and features that you’re
going to launch. With that. We’re going to wrap up.
Thank you very much once again, and all the best for
future success. Thank you.