(Image source: Stere homepage.)
Stere (New York), a digital ecosystem designed to tackle speed-to-market, capacity sourcing, and other challenges faced by MGAs and insurance carriers with regard to capacity, has announced that it has closed its seed funding round. The $2 million round is led by Fin VC (New York), with key participation from Plug and Play Ventures, Sandalphon Capital and Hartford Investment Management Company (HIMCO). Other participants in the round include angel investors Rob Johns, First VP, Alliant Insurance Services and Charter Board Member, TiE of Oregon, and Shamir Karkal, co-founder and CEO of Sila, Inc.
Stere describes its offering as a digital and scalable version of what today is an inefficient manual marketplace. Stere’s digital ecosystem connects “capacity seekers” such as MGAs, program administrators and embedded insurance platforms, with “capacity providers”—insurance carriers and reinsurers. Data analytics aids MGAs, brokers, and others with a more efficient process generating smarter and more profitable results.
Through Stere’s digital ecosystem, MGAs and other capacity seekers have unprecedented access to insurers and reinsurers as well as difficult-to-reach alternative risk capital providers, according to a Stere statement. This accelerates speed-to-market and assures an optimal fit between an MGA and a capacity provider. Capacity providers benefit from a “smart underwriting pipeline” for vetted MGA programs and embedded insurance opportunities, the statement says.
“Matching insurance capacity seekers with capacity providers is an inefficient process that relies on outmoded conventions and technologies,” comments Dogan Kaleli, CEO, Stere. “Stere simplifies the process and significantly improves the chances of long-term successful partnerships. We are delighted that our investors recognize the enormous opportunity to modernize and transform this essential process within the insurance supply chain.”
Stere notes that its target market of managing general agents, program administrators, and embedded insurance programs currently comprises approximately a $100 billion insurance industry segment. This market sector is expected to grow rapidly, especially as embedded insurance—insurance packaged with a product or service and purchased at the point of sale—becomes more prevalent, according to the Stere statement. Stere reports that it has brought aboard more than 40 MGAs representing $1.2BN in annual premium. Additionally, three embedded insurance deals have closed.
Addressing Clear Need in Program Business
“Stere is well positioned to succeed in a fast-growing segment of the insurance industry that is ripe for modernization,” comments Emy Donavan, Venture Partner, Fin VC. “The company has identified a clear need in the insurance program business, and offers an innovative, technology-driven solution. We are pleased to support Stere’s growth in this dynamic market.”
“Plug and Play is excited to invest in Stere,” says Eugenio Gonzalez, Principal, Plug and Play Ventures. “Stere is using technology to make the traditional, relationship-oriented insurance program segment more data-driven and efficient. With this investment, Stere will be in a strong position to bring much-needed change to this rapidly expanding area of the insurance industry.”
Stere says it will use the funds from this round to grow staff, enhance its portfolio of data analytics, expand its footprint in the MGA and embedded insurance segments, and launch new APIs to better facilitate integration between capacity seekers and providers.
Stere was formed in 2021 by Kaleli, former Head of Programs North America for Allianz Global Corporate & Specialty.