In advance of our series of matchmaking events we explore how start-ups and corporate partners can collaborate to drive innovation.
As professional services – insurance, law and accountancy – step up their drive to offer new AI-powered products, they are looking beyond their own innovation teams to partner with start-ups who can provide specialist skills and new solutions. “The appetite from corporates is now HUGE” says Stuart Whittle, partner at law firm Weightmans. “Law firms are busy trying to out-PR each other with announcements about AI and its transformative potential”, while insurance giants such as Prudential in the US are snapping up AI start-ups in order to move forward fast. Large organisations are not short of smart ideas but they do not always have the in-house skills or business agility to make them happen. At the same time tech entrepreneurs need to develop the most appropriate partnerships in order to grow successfully.
Finding the Right Partner
Navigating the complex and global AI markets in order to find the right partner can also be daunting – and time consuming – for any organisation. Conferences and events are useful but in this atmosphere there is a need for more innovative and effective intermediaries to connect businesses. One such is Early Metrics, a start-up ratings agency enabling corporates to build successful collaborations.
“We help corporates and investors identify and engage with start-ups in a really efficient way and it’s safe to say the pace has picked up recently” Early Metrics Partner, UK and International, Gene Gerrienne explains. “There are lots of matchmakers around but we differentiate ourselves through qualitative analysis and challenge-based scouting. We don’t charge start-ups for rating them and they are eager to be part of our ecosystem. In turn, our clients – who might want to invest or to partner up – know that their time won’t be wasted on companies that don’t meet certain criteria. The ecosystem is complex and we help reduce the ‘noise’ and mitigate risk.”
“Matchmaking events can be a great way to bring people together but to work well they need to be focused on specific challenges” Gerrienne suggests.
With this in mind Early Metrics are partnering with AI for Services to host an exclusive InsurTech Matchmaking event on Thursday 30th January 2020 in London. This session will offer AI & Data start-ups the opportunity to meet leading organisations and commercial partners in the insurance sector to explore R&D challenges. Confirmed participants include Axa XL, Brit, Bupa, Dai-chi Life, Direct Line Group and Hiscox.
When meeting potential partners and clients at events like this, it helps if the start-up has a working demonstration of its product to clearly demonstrate how it can help large firms solve their R&D challenge. Industry conferences are not always friendly towards start-ups who may have solid research credentials, but cannot provide a real-world demonstration or a clear path to market entry.
Successful UK start-up Tractable grew its insurtech business out of a machine-learning research project and now provides a highly focused, highly commercial AI that assists insurers to assess auto damage. According to Norval Scott, Tractable’s Head of PR and Communications, Tractable’s success is down to the company taking a commerce-driven path, rather than focusing on research. From the start, Tractable approached potential clients in the insurance industry directly, working with them to assess and shape its offering in response to real needs. Scott warns against the start-up trap that if you build something cool, customers will flock to your door – “laser-like commercial focus on what will work for your customer and for their customers is essential. The UK insurance market is very competitive and clients really do need to see bang for their buck.” Based in London’s Silicon Roundabout, Tractable is now growing quickly internationally – a potential sign of intense competition in the insurance market.
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There is also a delicate balance to strike between attracting investors and customers and working with partners, a challenge which Tractable has navigated successfully with its model, and Scott happily points out that “every company that has trialled our product has become a customer”.
AI development is throwing up new ways of working, in physical and virtual spaces, as it involves so many disciplines and stakeholders. Once the right partner has been found there are many different models for collaboration, and it can take time to ensure mutual understanding and develop a successful relationship.
A successful participant in the current Next Generation Services Challenge, national law firm Weightmans are collaborating with start-up Frontier on an 18 month AI-development project which could transform the services Weightmans can offer corporate clients. The aim is to create a product that assists legal experts in forecasting the reserve costs associated with personal injury matters.
Stuart Whittle, who leads innovation at Weightmans, is enthusiastic about the potential of this type of collaboration, but is also cautious about managing expectations on both sides. “Hype is an issue – there is a lot of hype around AI and data which raises expectations about what is and what is not possible. In my experience of developing AI product, interpreting the data, managing capacity and so on, is very hard work”. Even when there is a demonstrable prototype, it can take time in a large organisation to persuade stakeholders of its long term value, and to form a solid business case and delivery strategy.
It is a given that the pace of development in start-ups is faster and more agile than that within large, more strategic organisations, and Whittle explains that each side can learn from the other. “We like working with start-ups but we have procurement processes, quality, environmental and other standards, infosec, modern slavery policies and so on. These things we find start-ups don’t have or know nothing about. We have to be comfortable internally about reasonable risk. We sometimes find that we are helping the start-up with what we think of as basic business ‘stuff’ and this takes time, which can limit the number of projects we can undertake.”
It also helps to start small, or to have milestones built in to long term projects to help reduce drift. For Whittle, the regular visits from the Innovate UK Monitoring Officer provide a useful deadline for measuring progress in a complex world.
AI for Services Matchmaking Events
AI for Services, in partnership with Early Metrics, is hosting an exclusive Insurtech Matchmaking event on Thursday 30th January in London. This session will offer innovative AI & Data start-ups the opportunity to meet leading organisations and commercial partners in the insurance sector to help them solve their R&D challenges. Confirmed participants include Axa XL, Brit, Bupa, Dai-chi Life, Direct Line Group and Hiscox. Read more and apply here before 20 December.
AI for Services is planning two additional matchmaking events in London; on Legaltech on 5 March and on Accountancy Tech on 30 April. If you are a corporate or large firm working in the legal or accountancy sectors and would like to participate, please contact Astrid Ayel as soon as possible. Places are filling fast!