[Bootstrapped] Ep.161 - The First 100 with Gary Ross, the Founder of Blip

Gary Ross founded Blip, a tech-enabled and digital-first small business insurance agency.

Where to find Garry Ross:

• Website: (11) blip: About | LinkedIn
• LinkedIn (11) Gary Ross | LinkedIn

Where to find Hadi Radwan:

• Newsletter: Principles Friday | Hadi Radwan | Substack
• LinkedIn: Hadi Radwan | LinkedIn

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Transcript

I have a small favor to ask that takes you literally a few seconds. If you like the first 100 podcasts and the guests that we have invited so far, can you do me a small favor and give us a thumbs up on any podcast platform that you are listening on? It helps the podcast more than you think, because the higher we go on the ranking, the more interesting guests we can invite. Thank you again for your support. Broadcasting from around the world. You're listening to the first 100 a podcast on how founders acquired their first 100 paying customers. Here's your host, Hadi Rodwan. This podcast is sponsored by All-in-One, the premier fantasy sports site that is on a mission to bring all sports fantasy games under one roof. If you are into football, the Euro 2024 is coming soon. for free for the first predictor game. You can create free leagues, invite and compete with your friends and show your prediction prowess. May the best team win. Gary, good to have you on the show. How are you doing today? I'm very well. Thank you very well indeed. The sun's shining in London, so it can't be too bad. Indeed. How do you feel about the whole change in weather? There's sometimes it's sunny, sometimes it's rainy, sometimes it's cold. It's quite absurd, right? Yeah, it's a bit worrying actually. I'm probably quite glad that I concentrate on liability insurance and don't have to worry too much about these weather patterns. Yeah, it's a bit worrying and it should be warmer by now as well as far as I'm concerned. Absolutely. Quick introduction for our listeners. Gary Ross is the founder of Blip, a tech enabled and digital first small business insurance MGA or an agency. And the company has raised to date around 1.25 million from insurance practitioner. Gary, take us back to the top. What inspired you to start BLEP after you've been in the corporate world for nearly more than 30 years? I'd sort of done my career in the corporate world. And one of the things that I observed, if you like, is that for every pound of premium, up to 60 or often even higher is going on acquisition costs and expenses. And that we'd rather lost sight of what insurance was supposed to be all about. The premiums of the many pay for the losses of the few. And no one was really looking at. the small business insurance and people that are just starting out and don't really need a very complicated policy. They want to buy their insurance quickly and efficiently. So my challenge was to try to defeat the idea that insurance is a contract of mutual distrust, hit the distribution chain, if you like, to put more money in the pot, then to basically make our policy holders, pseudo shareholders, so they could. participate in the profits. So that was what was driving me. It was my aim, if you like, was to try and to bring insurance back to basics. Amazing. And if you walk us through the idea of how a policyholder would get back that benefit, if you give us your master class version of this. It's very simply. When we sell a policy, that policy is almost treated like a share in the company. So at the end of the day, when the premium is collected and we know what the claims are going and we make an allowance for our expenses, there'd be an element of profit. And that profit is then distributed back to our policy holders in line with the amount of premium they paid in and how long they'd had their policy. So very much like if you're a shareholder. So if you're a shareholder, you have to hold a policy on the date the dividend is declared, and then the amount of your dividend is subject to how many shares you've got. And so we're sort of a mirror image of that. This is what we're looking to try to do. Amazing. And if you think about it from the shareholder perspective, is it yearly? Is it every two years? How do you distribute and when do you distribute this? We usually do. We are intending to distribute six months after we close after the end of the year. So in line with our, our accounts basically, and anyone who knows anything about insurances, that there will be an estimate of the claims that is produced at that time. And so we'll have that number, we'll have the premium number, and then we'll be able to estimate the surplus. And that's how we'll do it. There's so many listeners who wants to do the jump as yourself from the corporate world to the entrepreneurial world. What surprised you the most after jumping from a corporate stable job into the chaotic startup world? I think the key words is that chaotic, but I was very lucky because the panel of our investors is made up of fairly senior insurance people in the London market, and therefore I've got a very firm foundation. I mean, I'm sure people who work in the corporate world are not going to agree with me, but life is very easy because I know that some of the transactions are large, but you know, you walk around Lloyds, there are big offices, there's lots of wine drunk at lunchtime on the expense account and just look at people's risks. When I think you make the jump into doing something for yourself, then you're back in the real world. I was at the SME Expo last week and you're talking to real people that are trying to run their businesses and have all those challenges. And I think it's a big bite of the reality pill. You've got to raise the money. You've got to, you've got to say what you mean and mean what you say. And then you've got to deal with the people that are actually buying the policy. 95% of all businesses in the UK are small businesses. It's not that corporate world of reinsurance and it's much more back to basic. So I think it's a big bite of the reality pill, I think. Amazing. How does your business model currently work? Do you go directly to the small businesses or do you use an intermediary? We go directly to small businesses. The whole business model is that we are looking to reduce that 65p in every pound that I talked about earlier, so that we can actually deliver that profit back to our policy holders and provide them with a better upfront premium, because there's more net premium flowing into the insurer. So we've taken the harder path, the B2B path. We're not on price comparison sites and we don't use brokers. Price comparison sites, they're expensive. It can be up to 50 pound policy bound. So I like to almost argue that we're the new direct line without the telephone. So we're using social media and we're going for the organic advertising rather than pay per click, all because we wanna retain as much premium so that we can get our upfront prices down. And then hopefully that divan that I was talking about earlier is real because there's more money to pay the claims basically. What channel has worked for you the most currently? Cause we know if you go through the aggregators, it's expensive. If you go through paid platforms like Google and Facebook, you spend a lot of money to buy leads. If you want to do the SEO play, it's a very long term, long tail process. So you won't get enough leads from day one. What has worked for you the most? At the moment, social media and the organic. I mean, we are doing the pay-per-click, but we are very, we've got a very modest budget. It's really just to get our digital footprint up there. Ultimately, it's about having the best product in a way and the best price. I mean, you can't be the best price. And I think the fact that we're not paying aggregators, we're not paying brokers means that we can offer a much better price, which is more attractive to the customer. I mean, it's very early days, but I would say that we're getting the traction through the organic and the social that we were hoping for. In fact, it's probably better than we were hoping for. But you're right, we have taken the more difficult path, but so far so good. What have you learned about the first hundred days of running an ensure tech? I think that nothing goes according to plan and there's a few blips, but I think the key is I've learned, I personally have learned an awful lot about digital marketing, so I'm now deep into Google analytics and having a look at how many people are visiting the website, where they're actually dropping off or not dropping off as the case may be. And I think that was the big learning curve for me. I've spent all of my life in insurance so I can talk about policy wordings and pricing and rates and I was responsible for claims for a good part of my career. All of our claims team are very close to me in blip. So we're trying to aim to pay claims within 24 hours. But the big learning curve in those first hundred days is getting those customers and getting the conversions. Absolutely. You're in insure tech so there's a tech next to the insurance part of the business. How important has technology played and how do you take a decision between what you bring in-house to build for your own IP and then what do you use off the shelf? Our focus has constantly been, because of my background on the insurance piece, and knowing what drives pricing and product has enabled us to concentrate the tech on the customer acquisition, the distribution side of the fence, where we've basically linked in. is on the policy issuance and the policy management, because that's basically standard stuff really. It's just how you link it in. It was the customer journey and how the claims interaction work is where we've focused on our tech. Amazing. What is the principle that you live by that has served you well on your journey? I think you've got to be upfront with the customers and your shareholders, I think, and always having the customer at the heart of what you're looking to do. because ultimately they are, we sell a product which is a price to pay, okay? So that is effectively your claim service and to provide someone with a good policy and then when it goes wrong and hits the fan that you're able to be there with them and get the claims, get the money to them as soon as you can. And I think we've looked to underpin that through this profit share model because when the customer buys a policy from us they will get terms and conditions. And that statement is in there as well. Now it will tell them how the profit, how the profit commission works. So I think that's my guiding light. If you like, you've always got to try to do the right thing. If you will know, no hidden clauses or things like that. Yeah, absolutely. What's the best advice that you have been given and what's the best advice that you have given? I think that the best advice I've been given is always hope for the best and plan for the worst to always have a contingency. I think that's very important. So life won't always go according to plan. So you need to always be thinking ahead and making sure that you're planning for that, particularly when it comes to sort of funding. I think the best advice I would give is that you need to be honest with whoever you're talking to rather, whether that's the investors in terms of the likely return and the period, or whether it's your insurance partner as to what you're looking to achieve and what the obstacles are. You need to basically know what you're talking about. There's no point in trying to bluff your way through something. It's a recipe for disaster. So you just need to be honest. And if you don't, and then, you know, we're, we're looking to that. Don't try and wing it too much. Absolutely. Thank you for this great advice. Gary, what's next now that you've started your journey, what's next for blip? Right. Well, we already have one product that we'll be launching soon, which is good, which is an enhancement to the business equipment. And we're in the process of finalizing our professional indemnity offering. So in the short term, it's the broadened our product mix to our customer base. After that, I think there's one of our investors is based in the Caribbean and he's already talked about small businesses are small businesses. So why not move there? And of course, maybe moving outside of the UK, but let's bed down in our home territory first. That's what I basically say. Great. We wish you the best of luck. Thank you for joining the podcast. And how can people reach you and are you hiring? We're not hiring at the moment. We are. We've got everybody that we need, but people can reach me through email or through social media, or they can just ring the telephone number at blip. And I'm sure that they can get put through to me. Perfect. We'll put all of this in the show notes. Have a great evening. Thank you very much. Yeah. Cheers now. Bye-bye. Thank you so much for listening to the first 100. We hope it inspired you in your journey. If you're enjoying the podcast, please subscribe to our podcast on Apple iTunes, Stitcher, Google Play, or Spotify, and share it with a friend starting their entrepreneurship journey. Leave us a five-star review. Your support will help spread our podcast to more viewers.