Tuesday, January 12, 2016

Want insurance for your next angel investment? Consider Assureli

Assureli’s algorithm and risk model helps angel investors make some money back on their investments even if the business they invested in fails. 

Originally from San Antonio, Texas, Tarek Hassan from assureli, has always been an entrepreneur.  He graduated from the University of Texas at Austin in 1998 and his first business, Surf Break, was a partnership which he created with Southwest Airlines and American Airlines, putting internet stations into their boarding areas (started in Austin airport in 2002) to help increase the value of customer service for their passengers in the boarding area.

Today he and his CTO, Pat Luciano have created a new risk model for the insurance industry focusing on startups.  With the 2012 JOBS Act and the SEC rules coming into place they are looking to help accredited and soon unaccredited investors reduce their risks.  The team includes two entrepreneurs, a Mathematics professor, and three actuaries. 

Assureli provides insurance to investors of startup opportunities

The idea came from seeing the large growth of entrepreneurs with great ideas and a growing number of investors entering the market through crowdfunding.  Assureli allows investors online or offline a new alternative to investing.  Instead of investing your money and losing it all when the business you invested in fails (which is a majority of the time) now the investor can pay a little extra with Assureli’s premiums to insure your investment.   If the business fails within a certain time period, the investor can make anywhere from 25%-75% of your investment back depending on when the business fails.   The premiums range from 10%-19% of the investment.  The insurance is non-transferable.

How does it work?

The premium payment to assureli will range from 10% to 19% of the investment made into the companies, based on risk of the segment.   Higher risk industries such as the food/hospitality industry will be closer to the 19% mark for example. 

How does the investor receive coverage in the event of a loss?

When the business invested in, fails in
year 5, then 25% of the investment is returned to the investor. 
year 6, then 50% of the investment is returned to the investor. 
year 7, then 75% of the investment is returned to the investor.

Under what conditions does it not payout?

The business is not determined to be a failure and funds will not be returned to the investor when the company fails, if:
1.      Business does not show signs of at least a 10% increase in revenue and customer base year-over-year, for the previous 3 years in a row of operations.
2.      An investment equal to half of the amount or more of the investment in question, is paid to the company on/after the 3rd year anniversary date of the first investment, to help its growth.
3.      Investor inaccurately submits information regarding the investment amount or the company the investment is made into.

What do you think?

We have included a very short survey and would like to request some feedback please.  It will take you only 2-3 minutes at most, it’s just a few quick questions, and it can provide the right feedback as we move forward to offer you this service, sooner rather than later.  Here is the survey link and a request for your feedback.  https://survey.zohopublic.com/zs/knCN9f

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