The insurance industry can hardly be accused of loving risk – but Aviva stands out in the UK as a brand that’s at least up for a bit of experimentation.
Having committed around £100m into its new corporate investment arm Aviva Ventures late last year, the company has now joined forces with Dot Com millionaire Brent Hoberman to accelerate its startup dabbling.
Aviva has become the official fintech partner for Founders Factory, the startup accelerator led by Hoberman, who made his name as a founder and CEO of Lastminute.com.
Aviva’s committed a portion of its investment millions to backing five existing startups each year – for a total of five years – as well as working with Hoberman’s team to come up with two new products every 12 months.
Founders Factory has already started accelerating education startups in collaboration with Holtzbrinck Publishing Group, plus new media companies in partnership with the Guardian Media Group.
The programmes for fintech, plus beauty and wellness backed by L’Oréal, are both live now.
Of course, the insurance market could benefit from being brought into the 21st century and Aviva will no doubt be interested in how automation and AI could improve its main business, as well as its wider wealth management portfolio.
But Hoberman tells NS Tech that, in theory, working with its brand partners, a product could come out of Founders Factory that addresses all of the verticals it’s working across all at once.
The investment model works through Founders Factory’s operating company, which takes a stake in each accelerated startup and incubated idea on behalf of itself and the relevant partner.
The ideas that are wholly conceived within the four walls of the Kensington space are 100% owned by the Founders Factory team and its partner, otherwise they take between a 5% and 10% stake.
For that, Hoberman says, the startup gets £30,000 cash, plus £220,000 in kind for office space and contact with industry pros, like himself, as well as things like design, growth hacking and technology resource.
Although working directly with what might appear to be lumbering legacy companies in an industry you’re hoping to blow apart, Hoberman defends the model.
“When I was working on Lastminute.com, we worked with BA, Virgin, KLM. That’s how we were able to get credibility and to smash open an industry.
“The probability of success is much higher, you have the ability to move faster, to accelerate and those relationships open doors. But we don’t own controlling rights to their company. And we will go down if you’re a rockstar with real momentum.”
He believes, overall though, the corporate accelerator space is way too crowded.
With everyone from ASOS to John Lewis inviting startups to join their various programmes, and even a conference dedicated to the model here in London, it has started to feel a bit unimaginative.
“We have massive brand names together – using one vehicle to innovate – with a core team of 30 and an operating budget. We’re not relying on temporary help.
“You don’t limit your options here.”
Founders Factory, like any other accelerator, cannot guarantee success, even with big household names or indeed a startup brand name like Brent Hoberman.
But it’s pledged pretty publicly that it’s going to build a total 200 startups over the next five years. And it’s fully armed to try to make them win big.