How Insurmi CEO Sonny Patel grew Insurmi to $360K revenue and 3 customers in 2019.

hello everyone my guest today is sunny patel he is the founder and ceo of insure me a white labeled convert conversational ai platform that enables carriers to generate new business online streamline claims and provide excellent ai driven customer service he's also a proud phoenix business leader who's passionate about helping other founders make their entrepreneurial dreams a reality sunday you're ready to take us to the top yeah all right man so tell us about insure me what's the company doing and how do you monetize what's your business model yeah so we are a digital engagement platform built for the insurance industry so we enable legacy carriers that are traditionally reliant on agents and brokers to take a direct-to-consumer approach to selling a policy filing a claim for a policyholder or providing customer service our business model is that we are a uh we we're a sas model so we charge a monthly licensing fee um in addition to a installation and and other uh setup fees um but we're a simple you know sas monthly fee we charge um 15 000 a month uh to every carrier but that's just kind of our starting point so we were founded uh two and a half years ago as a comparison site uh we launched that out uh joined the global insurance accelerator and we're pitching our solution to all these different insurance companies and um they all wanted what we had built for the comparison site so we looked at the market and and saw that it was a green field legacy companies wanted a new way to do business so we pivoted to the white labeled offering so 2016 2016 was launch date now customers pay on average 15 grand a month correct yeah okay very cool and what have you scaled to in terms of how many customers so right now we have three active customers uh two regional carriers one fortune 100 insurer um and then we're bringing on an additional four in q1 and q2 of this year okay so you're doing about 45 grand a month right now then in revenue yeah we're at well this month was 30 um and then next month it's going up to 45. okay good so the average is more like 10 grand a month correct yeah okay so 10 grand a month and where were you a year ago in terms of monthly revenue uh a year ago we were at zero because we have the comparison side then we made that pivot while we're at the global insurance accelerator so um we started booking revenue in august august of last year how have you gotten confidence from these big firms to pay you right out of the gate 10 grand you know per month it's very rare startups can do that because people go this company might not be around in two months right right well uh it's we had success with the comparison site right so the the revenue from uh that company we'd proven out that we know how to acquire customers online for insurance so the subject matter expertise that we bring to the table was a little bit different than just a startup right off off the bat and then also every company that we engage with customer engagement or reimagining customer engagement is on their uh road map for for the year so it was a part of their initiative uh last year and then this year so it's a priority for them have you have you raised capital we've raised 95 000. okay okay so not a time i mean basically bootstrapped um how much of the comparison site do uh so the comparison side we got it up to like 50 i think it was 15 000 a month 15 20 000 at max until we made the pivot interesting and is it still generating cash flow to fund this new business no no no so we we basically pivoted fully to this new uh this new model interesting okay and then walk me through the kind of your team today how many people yeah so we're a total of a total of eight um so we have a vp of care engagement who leads sales leslie uh two developers a designer and a product manager and then two additional part-time sales reps um fully you know we we were part of the coplex accelerator which is another accelerator down here in phoenix um and they basically help founders from idea to their c ready level which we're at now how much money do they put in and what equity they take for that none so i've paid all out of pocket through customer revenue and they just they charge you a fee to go in yeah yeah how much you got it well so it's 120 grand plus you have to pay for sprints and designs and it's it's not like the cheapest thing in the world but it's for their whole whole model is they want to target uh people that have like subject matter expertise in in a certain industry but don't really have the tech expertise so i'm not a technical founder yeah as a company you have eight people though now and thirty thousand dollars a month in revenue what so you're operating right about breakeven uh yeah okay are you burning or no um a little bit like i'd say five five thousand max okay yeah interesting 35 and is everyone based in phoenix yeah we're all based in phoenix galvanized phoenix okay and what about so you know obviously churn's a little tricky to measure with only three customers but how do you think about churn so what the way we look at it is how many of our customers are converting into commercial agreements so we do six or ten month pilots with every customer that we bring on board and then we do a 36 month commercial agreement after that the customers that we brought on board will convert into the three so far we'll convert into a commercial agreement but looking forward the churn for us would be the ones that go through a pilot but they don't convert into a commercial agreement if it's not successful but it's too early for you to say you have ten percent logo or revenue term per year yeah yeah we don't have the that amount of customers yeah what's it costing you fully weighted to get a new 10 000 a month customer uh fully weighted is 15 thousand and where's most that money going besides like the commission of the sales rep uh travel so we what we do is a little bit different so we don't do any go to meetings or anything like that at our company we travel out to the company uh meet with their team so it's a lot of travel entertainment expenses to be honest with you that's why you have that good looking floral shirt that's great for the clubs when you're trying to close a deal right yeah well i mean it's all it's all he you know it's business is a human thing right so i prefer as well as my entire team to be out there on the ground with them understand their challenges and then that's why we're winning all these bigger accounts one year by the way your economics work right at 10 000 bucks a month you can afford that someone's charging a grand a month or even 500 bucks a month you really can't afford to do that right exactly so when we look at the uh um total acv of what we're bringing in i mean ten thousand is is nothing honestly yeah um walk me through how you landed these first three customers were they also customers of the review site or how did you get them no so uh the first two i got through the global insurance accelerator so the global insurance accelerator is has 12 different investor companies that are all insurance companies and what they make you do is they send you out then you have to pitch your solution to all these companies and if there's a fit then they will sign on for a pilot and then eventually a commercial agreement so the first two i got from the global insurance accelerator and then the rest of them have all come from uh just networking or industry events so we've been out at primarily all the in short tech events um in the in the us over the past six months or so and then we're going to be out in asia europe so uh who so who are some of these customers by the way i mean is this like like blue cross blue shield yeah so we have currently we have principal financial group uh farm bureau financial group and then we're starting uh just in a couple weeks with american enterprise and then there's a couple of them they're fairly large insurance companies yeah i'm just saying like i've never gone to blue cross blue shield and like used live chat so i'm trying to figure out like the use case of this where is it actually being used it is live chat on their websites right yeah so it can be for for sales claims or customer service so our customer service solution would be that live chat solution that's powered by google's ai but companies are really using us for the sales aspect so how do they market their solutions online in a different way to connect with millennials and not even just millennials the growing digital uh consumer group that's out there yeah any plans to raise additional capital yeah so i'm actually out there trying to raise a 1.5 million seed right now so having just so many different investor calls even today the whole day i've just been having different calls um so we can expedite our product roadmap um expedite revenue and continue to grow the team are you gonna do on a note or a priced round so we're doing a convertible note okay and um and what do you think your cap at it's a eight million dollar cap interesting and i mean so so whatever you're 30 grand a month right now so we'll call that 360 grand a year so i mean obviously people can do the multiple math um i mean you think you'll get the 1.5 at the eight i mean we there's a couple commitments on the round at that valuation so i it's already been you know done um...