Tibbington Consulting has taken an equity stake in LAKA Insurance, the bicycle, health & recovery insurance collective.
This concludes the forth Private Limited Company equity investment of the year for the consultancy, which has been investing in financial services businesses and new start-up projects for the past several years.
Collective Model
Laka have turned the cycling insurance industry on its head with a unique collective model in which their members share the cost of all claims. Laka only earns its share when settling claims for the collective. It’s a new insurance model that’s built on transparency and mutuality to benefit the people.
Co-founder Tobias Taupitz used to work in Corporate Finance at Barclays, and, prior to that, at KPMG. His focus was on mergers and acquisitions in the financial services sector. More specifically, he worked in the FinTech and Insurance verticals and had the chance to work on some great transactions, including London Stock Exchange Group’s acquisition of Russell.
He studied insurance business and actuarial science, following an apprenticeship at an insurer. This experience gave him a good understanding of how insurers are run and some profound insights into the good, the bad and the ugly of the industry.
Traditional insurance
Traditional insurance charges customer premiums upfront based on estimated claims, plus expense, risk and profit margins. You’re asked to hand over money first, with the promise of getting your claim settled down the line. Of course, handing over money back to the customer means less in the pocket of these traditional insurers. This makes smooth claims experiences a rare find. Customers always come second in the relationship.
Laka’s core hypothesis has remained the same throughout: the provider (us) and customers (you) are better off by turning things upside down and charging the Laka collective based on the actual cost of claims incurred rather than those that might.
Covid bump
The Covid pandemic has seen an upsurge in new business, as more and more people move from public transport to bikes.
It is fascinating to see the momentum in cycling. Hardly a day goes by without big headlines including that this would be the golden era of cycling (PM Johnson) or that London will be the largest car free city in the world (Mayor Khan).
This is rocket fuel for our business, and we learned quickly to deal with the increased interest. Laka is as much ‘insur’ as it is tech (“insurtech”) and we’re always looking for tech solutions first.
We plan to establish Laka as the leading partner for personal mobility in Europe and will offer products that keep you in the saddle longer. This might be on the insurance side as much as non-insurance. A good example is our recent brand collaboration with Rapha, where we offered a cycling kit of Rapha quality in the Laka design. Within days of launching this initiative, we were sold out.
If you have a start-up venture in the financial services sector, or are an existing business in need of a capital injection or some expert guidance and help, then please feel free to contact us to discuss options.