This Entrepreneur Raised $140 Million To Offer Insurance Against Climate Risk
Tanguy Touffut has gone from corporate to startup entrepreneur. Raising many millions of dollars to grow a global company that helps others anticipate and protect against climate change risks.
During our time on the Dealmakers Show Touffut talked about fundraising, what you need to build a global business, intrapreneurship versus entrepreneurship, insurtech, and the evolving threats of climate change.
Tanguy Touffut was born in eastern France. Which gave him an early start to understanding business cycles. He got to witness how the heavily industrial area suffered as the world changed and was altered by innovation and technology.
His father was a veterinarian. An entrepreneurial and independent type of profession, like being a doctor or lawyer, with your own practice. You are tasked with going out and finding your own revenues.
Tanguy chose to focus his studies on finance and economics. He chose business school, as he saw it as a passport to getting into management. As well as providing more insight into the economy, on top of the credibility it would provide.
Prior to jumping into business for himself, he developed his experience working in banking, consulting, and then a large company within the industry he is tackling today.
Working for a global consulting firm he got to travel from the Americas to Africa and Asia, working with different business clients. Often large insurance companies.
These experiences gave him insight into the mistakes to avoid when building a company, the regulatory hurdles of running a large organization, and the necessity of innovation, to remain useful and relevant. As well as when there is opportunity to disrupt an outdated industry.
Throughout our Dealmakers series this year we’ve been seeing a trend in many successful entrepreneurs who have raised large amounts of funding, and who have achieved big exits, who have previously had entrepreneurship experience in larger organizations first.
In this founder’s case, he joined large insurer Axa. It gave him great insight into the differences between large established companies, and startups.
On one hand he points out that larger organizations have lots of resources, and can perhaps scale things faster. At the same time they have many constraints too. They may even be under more pressure to generate revenues quickly, and err on the side of short term thinking, to get those short term results.
Tanguy had the opportunity to experience intrapreneurship at Axa. That is starting up his own project under their umbrella. A way to test what worked and didn’t, without taking all the risk himself on his own. In this case, a parametrics project, with 30 people on his team.
This gave him some freedom, but while still juggling the complexities of being in a large corporation, with many differing opinions.
Ultimately, Tanguy decided to take the leap into a startup of his own.
He says the decision and timing come down to a few things. One is taking a moment to look ahead, and ask if you are going to be happy if you stay on the same path for the next 10 to 20 years.
Then there is the ability to recruit and bring along colleagues with the same vision. The allies and resources to make it happen. After that he says it is about getting a hit to keep on rolling with, and then just putting in the hard work.
Tanguy Touffut’s startup is Descartes Underwriting. A next gen underwriter, and insurtech company.
Their clients are largely made up of big corporations, and over half a billion in revenues. They have offices in the US, Asia, and Europe. Their fast growing team represents 25 different nationalities.
He started with building the founding team, then the best people that they could find, based on their technical skills, regardless of their location.
Descartes focuses on designing innovative insurance coverages to cover natural disasters. Like earthquakes, tsunamis, tornadoes, and wildfires.
Perhaps one of the big things that stands out about this company is how they’ve taken to underwriting with climate change as a factor.
As Tanguy points out, there is a lot of historical data on these disasters. Though we also need to understand their causes, and what’s changing. For example; the nordic region of Sweden, Norway, and Finland may not have historically experienced many wildfires. Climate change may now be changing that. Something they can gauge with more data, new data sources, and new algorithms. They have a whole team of 65 people dedicated to this, which they plan to double in the next year.
Descartes Underwriting has already raised over $140M to date.
They have brought in investors from all around the world. Which has certainly helped with their aspirations to go global from the start. It certainly helped when COVID hit, and it became challenging to travel and meet overseas investors.
He says it was also powerful for having local expertise when launching in new markets.
Balancing the interests of the different stakeholders in insurance world · How big this insurance space is · Tanguy Touffut’s top advice when launching your own startup
