Atlanta-based InsurTech startup Layr is growing its cap table with the announcement that the team closed a $10 million round of financing.
The team most recently raised a $10 million Series A round in March of 2022. But, of course, the fundraising landscape looks completely different than it did a year and a half ago. But founder and CEO Phillip Naples (in featured photo) said that funding is still “accessible” for teams that show the ability to execute on a plan.
“I’ve gone through the fundraising process a few times now. The landscape has gotten more challenging, but it’s still accessible for solid businesses with a strong offering and unit economics. It’s not more difficult, it just takes more time and more work up front. VCs are more thoughtful, and require more due diligence before you get to a term sheet. This round is right on track for us. We had a plan, executed it for the past 18 months, and reached our goals,” he told Hypepotamus.
Naples added that the new round of funding will go towards expanding Layr’s sales, marketing, and platform efforts.
“The small business insurance market is large and growing but inherently costly to manage. The challenge is compounded further by an undersupply of licensed account managers, acting as a bottleneck to longer-term growth of the brokerage,” said Stewart Pond, Cota Capital’s principal. “Layr aligns their incentives with the broker, by leveraging its platform to service customers at higher profit margins while ensuring a best-in-class experience. Insurance carriers recognize the value that brokers provide as a trusted advisor in their community as customers seek coverage. Layr is building the infrastructure to automate manual, time-intensive tasks and help brokers focus on areas where they can provide the highest value for customers.”
What Layr Does
Founded in 2016 by insurance industry veterans, the Atlanta-based startup is a cloud-based tool for independent commercial insurance brokerages and improves how those brokerages work with small business customers.
Layr does this by digitizing the traditionally manual process of sending over manual invoices and checks. Brokers are able to offer policyholders an online hub to manage accounts, access insurance documents, make payments, and get online quotes all in one place.
This is critically important since over 5 million new small businesses were created in 2022 alone, representing more than a 40% increase from pre-pandemic levels, according to the US Census Bureau.
The overall insurance industry is massive but has been slower to adopt technological innovation, making it a sector ripe for startups.
“One of every four dollars in the GDP goes through the insurance industry, yet it’s glacially slow to change. Many of the tools to distribute and service insurance products are outdated, using the same technology as when I entered the industry 20 years ago. Layr’s changing that for underwriters, brokers and policyholders,” said Naples in a press statement. “When brokers use Layr for their small business insurance management, their policyholders receive insurance services that are as easy and painless as their online banking. With Layr, broker partners handle more clients with ease and at higher margins, all while gaining valuable business intelligence. It’s time to bring small business insurance into the 21st century.”