Indio, a commercial insurance platform for brokers, has raised $2m in a seed financing round.
Venture capital firms NEA, Compound, Merus Capital and 500 Startups participated in the round, along with insurance carrier Hiscox.
Indio will use the seed round to grow its user base and platform.
Indio was founded by Paul Butler, Michael Furlong and Matthew Watson. The entrepreneurial team has extensive experience across traditional financial services and technology. Paul Butler was one of the founding engineers at Marin Software, Mike Furlong was a founder of Sliced Investing (Y-Combinator, Khosla Ventures), while Matthew Watson was a former trader at Citigroup.
Indio co-founder Mike Furlong said: “We've seen a lot of startups approaching the space trying to replace the broker.
"We feel that the broker is a necessary part of the commercial insurance buying process. Indio takes a contrarian approach, empowering brokers with technology that streamlines their workflow."
Brokers that utilize the Indio platform will gain access to a connected commercial insurance marketplace, centralized quoting and digital tools to interact with end clients seamlessly.
Indio co-founder Matt Watson said: “Some brokers spend almost 85% of their top-line revenue on SG&A.
"Much of this cost is operational in nature and relates to moving application data from the client to the carriers. We help brokers reduce this cost substantially."
Indio's approach of empowering traditional brokers has also resonated with industry leading insurer, Hiscox, who made a strategic investment in the platform.
Kevin Kerridge of Hiscox noted that brokers are here to stay, stating, "They will just look a bit different, and be more digitally enabled. Indio has the opportunity to power this change."
A primary focus for Indio will be working with existing insurance companies.
"The sophistication of insurance companies varies dramatically — some are already launching public APIs while others operate largely in spreadsheets," remarked co-founder Paul Butler, who has broad expertise integrating with the legacy technology of utilities, energy companies and search engines.
There is precedence for Indio's approach across other industries, particularly those that have layers of intermediary distribution channels.
NEA partner Rick Yang said: "You've seen the success of this model across other industries such as financial services and travel.
"Indio aims to be the centralized operating system for the commercial insurance transaction — similar to what Sabre did for travel agencies, or what Schwab did for wealth managers".
Industries with products distributed through high-level knowledge workers have been well suited to technological enablement as opposed to disintermediation.
Josh Nussbaum of Compound echoed this sentiment in noting that, "It is our belief that in industries lacking commoditization like commercial insurance, the broker will remain an integral part of the buying process. Indio's workflow automation platform allows brokers to focus exclusively on being high quality advisors and less on operations."
Currently, over 96% of commercial insurance is sold through traditional brokers. The goal of Indio is to power every single commercial insurance transaction that goes through this channel.