Jan 18, 2019 · 33m · 20vc
20VC: Why Every Company Looks One Round Earlier Than It Should Be, Why Investors Don't Understand Term Sheet Psyche & How The Brand Behind The Investor Can Overweight The Attention Their Opinion Is Given with Assaf Wand, Founder & CEO @ Hippo
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In this episode of The 20 Minute VC, host Harry Stebbings interviews Hippo founder Assaf Wand about disrupting home insurance, fundraising blitz strategies, board governance, and transforming insurance into a proactive protection model.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Harry holds 29% of the talking time here. How this is scored →
Harry as informed peer 2.7 Guest teaching 4.5 Guest disagreement 3.0 Harry pushing back 1.5
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 22:29 Assaf pushes back on top VC valuation discount
Assaf recounts telling a prestigious VC firm asking for a valuation discount that their two hours of advice per week only justified a two percent discount compared to his team's thousand hours.
Hardest push from Harry ▶ 19:00 Harry counter-argues with Reid Hoffman quoteHarry pushes back against Assaf's strict fundraising blitz policy by invoking Reid Hoffman's advice that founders should take money whenever it is on the table.
Biggest teaching moment ▶ 8:10 Explaining InsurTech valuation mispricingAssaf educates Harry on why traditional VCs constantly misprice InsurTech startups one round early because they fail to understand underlying regulatory de-risking and reinsurance structures.
Harry holds his own ▶ 9:49 Harry challenges guest on tier-1 VC necessityHarry presses Assaf directly on whether securing a top-tier VC is actually necessary, forcing Assaf to defend his contrarian stance against name-brand venture firms.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| Assaf Wand's Path to Entrepreneurship and Launching Hippo | 1 | 3 | 1 | 0 | Harry asks standard setup questions regarding Assaf's background. Assaf outlines the three structural shifts in AWS infrastructure, data availability, and online consumer trust that enabled modern InsurTech. | |
| VC Misconceptions and Valuation Realities in InsurTech | 3 | 6 | 4 | 2 | Assaf explains why traditional VCs misprice InsurTech companies one round behind because they fail to understand insurance mechanics. He also candidly questions the true value add of tier-1 VC brand names. | |
| Fundraising Blitz Strategies and Term Sheet Dynamics | 4 | 6 | 5 | 4 | Harry challenges Assaf's fundraising views using Reid Hoffman's quote on taking money whenever available. Assaf rejects the continuous fundraising playbook and breaks down term sheet psychology. | |
| Strategic Investors, Board Value, and Negotiating Equity | 3 | 5 | 5 | 2 | Assaf discusses strategic distribution partners like Lennar and recounts telling a top VC firm demanding a valuation discount that their two weekly hours only merited a two percent discount. | |
| Determining When to Scale Growth Channels | 3 | 3 | 2 | 1 | Assaf explains Hippo's framework for monitoring CAC and gating marketing channel growth, followed by a collaborative quickfire discussion covering books and Israeli founder culture. | |
| Hippo's 5-Year Vision and Proactive Prevention Model | 2 | 4 | 1 | 0 | Assaf describes his vision for Hippo, reframing insurance from reactive claims payouts to proactive risk mitigation using home maintenance services and IoT devices. |
Statements from this episode (12)
Wand: Legacy backend costs made pre-cloud insurance startups financially unviable
“Anything you wanted to do in insurance, you needed to set up a full back-end system. I guess you could get companies like Guidewire, get Accenture, get Oracle Database Nine, or whatever was in that sense, you know, the options. That would have cost you hundred…”
Wand: Modern data sources give insurtech startups an advantage over legacy carriers
“Data, if anything, it flips. So I'm actually an advantage. I don't have just ten million customers in the US data. I have a hundred million customers data. I have more data that I can actually use. I have more data components that keep on popping every day. I …”
Wand: InsurTech startups look one funding round earlier than they actually are
“In general, what happened, and this is my view for InsurTech, is There's a lot of interest and demand, and a lot of players actually wants to do something in this field. However, every company looks one round earlier than it should be. What I mean is that a co…”
Wand: VCs undervalue InsurTechs because they misunderstand insurance de-risking mechanics
“VCs don't really understand insurance. So they don't understand the risking that was done behind the scene. To lower the risk and actually bring you to have a customer. They don't understand how you manage your claims, and what you've done on the reinsurance, …”
Wand: Not a single top VC fund truly understands Hippo's business
“There's not a single top fund that truly understands what the hell am I doing?”
Wand: Startup boards overweight top VCs' opinions based on brand, not merit
“Usually, if there is a partner from a top fund, there is a tendency to give overweight to his idea and decision point, where it's not substantiated by the merit of his idea, but just rather from the fact that he came from Sequoia, he came from Benchmark, he ca…”
Wand: The average age of a Hippo employee is 42 years old
“Average age of our employees is around 42.”
Wand: Fundraising time pressure favors VCs, so founders should run blitzes
“The time value is always in the benefits of the fund and not of the founder, and because of that, I think when you're doing a fundraising, it needs to be a condensed blitz and have 20, 30 meetings in that week, see what's going on, push it to the next level.”
Wand: Strategic corporate investment dramatically increases BD partnership success rates
“If you're having them as a strategic investor with a very specific deliverables, then the likelihood and the chance of these deals succeed are, I don't know, a hundred times more than you thought before.”
Wand: Startups must gain distribution faster than incumbents achieve innovation
“Because in essence, the fight that you have of incumbents versus startup is a startup needs to reach the distribution faster than an incumbent can reach the innovation.”
Wand: External board members rarely provide continuous ongoing value to startups
“It's going to be very rare for an external person to come up with continuous ideas and value on an ongoing basis. I'm not saying that they can't bring a lot of value every once in a while, but not on a continuous kind of level.”
Wand: Disregard for structure drives Israeli entrepreneurs into insurtech
“As Israelis, we don't have a lot of respect to structures, which is maybe why there's a lot of Israelis working in insurtech, because it's a regulated industry, and to begin with, we don't have a lot of values to regulated industries.”