- Can you share with us Covertree’s founding story? What prompted you to start it after stints at places like LinkedIn and AWS?
Born and raised in Michigan, I’ve grown up seeing traditional industries: manufacturing, construction, automotive, agriculture. Our fascination has always been applying technology to those traditional industries. When working at LinkedIn and in Silicon Valley, we often thought, “what if everyone here applied their mindset and skills to middle America and traditional industry”–the possibilities and change would be huge. Insurance is a fascinating segment: it makes us 11.8% of the US GDP, but the average age of an insurance agent/broker is 60 years old. It’s not a field we saw many of our peers getting into.We sat in brokerages everyday, listening to calls and learning the-ins-and-outs. It confirmed a lot of our beliefs. Insurance is our obsession.
- What got you interested in the manufactured housing industry and in particular insuring those types of homes?
24M Americans live in manufactured homes (7% of the US population). It’s core to the American Dream of American homeownership. The pandemic taught us it’s the future of how we’ll live. It’s difficult to build homes onsite (1) getting materials there: supply chain (2) hiring talented labor on-demand. On top of this, housing costs and rent spiked. We saw people moving out of major cities and into more rural/remote areas.It makes sense to build homes in an air conditioned factory on an assembly line–efficiency with material waste and production is more sustainable. In 2022, 10% of all new home builds were manufactured. Traditional manufactured home production will continue to boom, but there’s an emergence of a new segment of modular homes, tiny homes, ADUs, etc. While manufactured homes are the future of the way we’ll live, consumers can’t get a traditional mortgage or insurance policy for these homes. To move the industry forward, we’re supporting financial services by building a fantastic and easy insurance product.
- You founded the company in Detroit. Tell us about that decision and both the unique opportunities and challenges it presents.
There are 250,000 manufactured homes in Michigan–we are big consumers of manufactured homes. It’s important to be close to our consumers. The industry is based here: within a 30 min drive sits 20% of the top community owners. 1 in 3 major manufactured home communities in the country is owned by a Michigander. We have great insurance talent in Michigan.
- You’ve spent time visiting manufactured home owners across the country. What have you learned from these visits to “middle America”?
In starting CoverTree, I’ve stayed in numerous manufactured homes across the country. Additionally, we’re in communities on a weekly basis. The biggest thing we’ve learned is the sense of community and pride in living in a manufactured home. Additionally, in these homes, people can truly live more “off-the-grid. ” manufactured homes are contained and can be more energy efficient with energy usage.
- How do you think about and approach building your team, given your location?
We enjoy having shared experiences with our teams. As a result, we’re from similar cities and states. We grew primarily through our personal and professional networks.
- What’s an under-appreciated talent you look for in new hires?
The ability to get obsessed with anything!
- What’s an important trend or technology in your space (i.e., Insurtech) that you are following?
Continuing to get more and more current data for underwriting and rating. Additionally, more complex weather data and modeling—i.e. how can we predict the weather?
- What advice would you give aspiring – yet first time – entrepreneurs who are thinking about starting a company?
Look where others aren’t and be obsessed.
- How have early investors like AV8 been most helpful to you?
Amir has been a great friend through building CoverTree. He’s often the first person I go to for opinions and bounce ideas off of. As we continue to evolve, AV8 continues to be a huge supporter of our team and vision for the company.
- What have you recently read or watched (books, TV, movies, etc) that others should know about?
I enjoy watching documentaries on the history of the United States. We’re a young country, but history seems to repeat itself.
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