3 days ago4 min read

Scout InsurTech Interview with Faura

Faura is an all-in-one tool for analyzing and incentivizing the natural disaster resilience of homes and commercial structures. They seek to help you pinpoint the survivability of a building for all natural disasters, and the mitigation discounts or extra incentives that go with it. Chris Luiz sat with Founder and CEO, Valkyrie Holmes, to learn more about how Faura is impacting the industry.

What is Faura’s client focus?

We sell to agencies, NGAs and carriers.

What does your product do?

We are a loss-control solution for disaster-prone books of business. We're helping insurers find more profitable customers in disaster-prone areas and helping keep their existing customers insurable.

How much capital have you raised?

We’ve raised over $500K, and we are now closing up a $3M seed round.

Was the company born from within or outside the industry?

It was born from outside of the insurance industry. It was originally in grant organizations, helping people mitigate their risk in places like Napa Valley for wildfire, and we slowly expanded into more stakeholders.

What growth metrics have you accomplished over the last 12 months?

We're hitting around 14,000 assessments for policyholders, so 14,000 people across the country who have been using our tool to mitigate and assess the risk on their property. We have seven clients we're working with, and we've expanded to all of the major perils - wildfire, hurricane, hail, flood and earthquake.

Within your domain, what is the current challenge that the industry is facing?

The most interesting thing that I first found about insurance was this idea that the industry as a whole relies on the fact we make money if we are insuring small or rare events and natural disasters. This was true up until the last decade or so, and now, we have to find a new way to reduce our risk and find the best risks. The best risks are always going to be the ones with zero natural disasters present, but the market of those properties is dwindling relatively quickly. That's one of the biggest problems of the industry. It’s this idea that we're using climate models that are telling us how likely a property is to be hit by a natural disaster, but we really need to understand which ones are going to survive to give us the best margins of risk.

How does Faura take a unique approach to providing value?

We are assessing the survivability of properties in a portfolio and helping find more profitable properties in these disaster-prone areas. There are a lot of different elements of properties that you would have to get from multiple models in aerial and satellite views or sending out an in-person inspector. For the in-person inspector, much of that isn't scalable, and it's relatively expensive and time-consuming. For satellite and aerial imaging, they rely on models that are telling us the area to which a disaster is going to happen and not necessarily how likely that is to result in a claim for the property. We're taking both of those metrics and combining them to make a better solution.

What inspired the team to start this company?

I was working in data science at SpaceX, and I received a grant to pursue something in sustainability for two years. I met my Co-Founder on a wildfire subreddit when we were talking about the state of the industry. I had done projects in wildfire before, so I was immediately drawn to solving something in the natural disaster space. We started outside of insurance working with grant organizations to help people reduce their risk and qualify for those grants. That was originally what we built the software for.

As we started digging deeper into aligning incentives, the biggest thing that we saw was with a problem like this, there are all of these different legacy stakeholders that you need to align to be able to actually solve the problem. At the time, insurers and homeowners were thinking a lot more about each other than they had in a long time, especially in the property space. That made us think, ‘Maybe it would be better to pivot more in terms of an insurance angle and help more people who are losing their homes because they can't get insurance and don't know why. We're collecting all the data that we can use to help make better decisions and offer more business stay in the market. As many people say, we fell into insurance.

Can you share any goals for the next 12 months?

We're trying to get to 20 clients. We love MGAs and carriers with a climate focus as well as people with specific needs for resilience in the market. We're trying to target customers and create value in that way. Apart from that, in the next 12 months, we hope to have over 100,000 homeowners that we've helped mitigate their risk. In many cases, that translates to millions of dollars in incentives for policyholders who are inherently reducing the risk of the insurance company at the end of the day.