Investing in Enzo

Traditional insurance is undergoing a rapid cycle of digital unbundling and repackaging: A handful of technologies such as cloud infrastructure, AI and IoT are forcing industry incumbents to level out their technological deficits, while opening up opportunities for startups to fill this gap. Our most recent portfolio company Enzo targets a yet widely untapped insurance subsector: The property insurance market.

It’s Friday afternoon and the phone is ringing: “The wall in the apartment is wet”, “There is a puddle in the basement”, “Pipe burst!” — every home owner has been in this situation. It happens every 30 seconds in Germany. A piece worth a few cents breaks and causes a damage of a few thousands up to tens of thousands of euros. Even if those cases are covered by a property insurance, the process in such a case is long, costly and inconvenient for all parties. Today, landlords and insurers can’t do much about it. After signing a contract, they keep their fingers crossed and wait for the next pipe to burst.

Leaking water pipes in buildings are almost unpredictable for insurances. Just in Germany they cause more than 55% of the total annual payouts of 6bn+ EUR . A profit killer for the 107 property insurers in Germany, who are already operating in a difficult market environment. With combined ratios varying between 104% and 95% in the 2010's, it’s almost impossible to make underwriting profits with such a relevant insurance product.

For homeowners and landlords property insurance is a necessity, a mind wrecking one though. The entire process from signing to claiming and refunding is complex, intransparent and time consuming. Getting an offer for property insurance requires dozens of pages of paperwork. Once a contract is signed both the landlords and the insurance just keep their fingers crossed and wait for the next damage to occur: Most likely due to leaking pipe.

Enzo’s vision is to ease this pain for homeowners and insurers with a digital first product. Instead of crossed fingers, Enzo’s focusses on prediction and prevention as a leverage to make the difficult home insurance market profitable again. Combining existing sensing solutions with a digital insurance platform, enables the startup to push for a significant reduction is water leakage related payouts. At the same time.

Here are a few facts that make us believe in Enzo.

European heating cost regulation forces landlords to implement digital submetering. For a data first insurance company like Enzo, that’s a perfect breeding bed to have more transparency on their own risks.

Enzo’s go to market is independent from traditionally strong broker networks in Germany. Through their MGA model they can scale as an operator for existing insurances.

Sascha Wolf and Marvin Follmann are the right team to flip this market. Building Getsafe’s insurance platform, makes Sascha an insurtech hero who already successfully disrupted another area of the insurance market.

We successfully proofed the concept with a set of pilots in the Styx Living Lab and detected two leakages in just three months. Partnering up with Comgy, the leading digital metering company in Germany, we take our co-development to the next level.

The team attracted industry experts from the C-Level and convinced best in class angels and VCs, amongst them 2bx, the latest fund coming out of the Signa group of companies.

The market potential is huge. According to a C-Level executive from a leading insurance company, a reduction of the loss ratio by 5% would be a game changer for the entire 8bn EUR property insurance market.

As the first investor in Enzo, we’re excited to be part of this pre-seed round led by Marc Harre of 2bx and complemented by amazing business angels. We’re looking forward to continue the ongoing co-development with Sascha and Marvin in the Styx Living Lab.