Q&A, Q&A- Startups

7 Questions with Sandro Matter of vlot

1. Please tell us a bit about yourself, both at work and leisure.

Having lived the first childhood years in Nigeria (my father in that time was heading up the marketing activities of the pharmaceutical company Roche for the African and Middle East region), I spent my entire school time in the area of Basle (Switzerland). After graduating from high-school and passing the mandatory Swiss military service (as an armed cyclist), I picked up my studies at the University of St. Gallen (HSG) – enriched by the invaluable experience of exchange semesters in Oslo (B.I.) and Sao Paulo (FGV), respectively.

Equipped with a master degree in Banking and Finance and one year of experience as a consultant in the financial industry, I took on various business management as well as strategy and business development roles for a leading global universal bank. After almost a decade, the decision matured for me that time was up for some real change … with the eventual result of launching vlot with my co-founder Daniel.

When it comes to leisure time, I have a great passion for outdoor sports – besides all kind of winter activities (skiing, cross-country skiing, ski touring) particularly race cycling. But above all, I try to spend good quality moments with my family (a lovely wife and two little girls in the age of 5 and 7) as well as dear friends.

2. Which product or service do you offer, and who are your competitors?

vlot helps families and individuals rapidly and intuitively understand the financial impact of death, disability and the lack of adequate retirement funds. By aggregating social security, employer benefit as well as relevant personal data, the vlot workflow transparently displays a potential household income and savings gap on a mobile first basis. In collaboration with insurers, banks and pension funds, vlot’s API based architecture allows for seamless integration of white label product offerings as well as underwriting engines for smooth end-to-end digital processes. The vlot multi-channel approach allows for a variety of formats from straight through D2C to using a vlot mobile application as a supporting tool for physical advisory or in a worksite context. Furthermore, a comprehensive data and analytics offering gives in-depth insights into all form of digital interaction along the customer journey.

When it comes to competition, we have developed our own radar that allows us to compare vlot with other relevant players alongside ten particular criteria (including e.g. offer similarity and geographical reach / market coverage). While we do not see a particular competitor operating in the same market with a comparable value proposition, I can mention the following five companies that are active in a similar space: Riskine, Anorak, One Insurance, Braingroup and iptiQ.

3. How did you get the business idea and take it from launch to the first customers?

Not too long ago, my life changed a lot: to the sad side, my mother died out of the blue. To the positive though, my wife gave birth to our 2nd daughter. And we bought a little house. This all within a time frame of 3 months. Signing the mortgage loan, we asked: what would be our situation in case of disability or death? We received a complex analysis and found ourselves in a lengthy, paper-based process between us, our bank and the insurance. It was in that time I met Daniel, who advised me and my family perfectly. With his own broker company, Daniel specialized in (life) risk analysis and coverage consulting for private as well as corporate customers and had many visionary, technology-driven ideas in that space. Our client-advisor relationship became friendship and we exchanged thoughts on business opportunities when cycling together – a highlight being our joint Swiss vice champion title in the 2016 TORTOUR road-ultra cycling adventure (a 1’000km non-stop i.e. 24/7 format around Switzerland). This was our breeding ground for founding vlot.

We launched our first live application in February 2019 – a B2C proposition under the vlot brand for private customers directly in the Swiss market. A bit later in 2019, vlot’s focus shifted entirely to a B2B(2C) business model, offering white label software solutions to B2B customers. Here, the active B2C proposition served (and yet serves) as our live demo case. Up to today we have conducted a handful of paid pilot projects in Switzerland and Germany with well-known and highly respected insurance companies and are in negotiations for longer-term collaboration settings with some of them.

4. How have you financed your startup? Any lessons would you like to share from the fund-raising journey?

When we incorporated vlot in Summer 2017, we were not yet connected in the FinTech / InsurTech ecosystem, and not thinking in classical startup venture capital terms as well as respective mid- to long-term financing scenarios. Our primary goal was to execute on our idea in order to do business. In those very initial days of our journey, we were surrounded by a handful of early family & friends supporters that believed in us as a team and the general idea of vlot and hence contributed respective seed capital in a first little financing round.

After a couple of months of sharpening our proposition, the business model and developing prototypes, we were overwhelmed by the positive response from relevant ecosystem and industry players – leading to our acceptance to highly competitive accelerator programs in Switzerland (Kickstart), Germany and in the Silicon Valley (both Plug & Play) as well as an attractive and promising customer pipeline. Based on this positive breeding ground, our journey got backed further with continuous funding by our early stage shareholders – topped up with additional private investors and business angels that have joined our cap table in our March 2019 seed round.

Earlier this year we launched a financing round through convertible loans following a flexible, stepped approach via various tranches – whereas we successfully raised the first one despite the adverse circumstance that our respective activities landed amidst the COVID-19 pandemic. As we conduct this interview, we are continuing our fund raising and are in final due diligence phase or discussions with a few select VCs.

If I had the chance to build vlot from scratch again, I would raise more capital at an earlier stage of the company journey (complemented by more smart money from sophisticated FinTech / InsurTech investors) – this to account for the usually quite long B2B sales cycles and increase the capacity to hire top notch software developers from the beginning.

5. Which are the key trends and opportunities in (European) financial services?

Limiting it down here to the space we are operating in with vlot, I see a push towards increasing the digital interaction in general (a trend that in the short- to mid-term is likely to get further tailwind as a consequence of COVID-19) – meaning: InsurTechs that help an incumbent bridge the physical distance that customers need to experience in all stages and touch points of the customer journey are well positioned.

From our ongoing discussions with insurance partners we’ve particularly seen an increased willingness and ambition to speed up digital transformation plans – aspiring to digitize the entire customer journey from the initial coverage need analysis (the core of vlot), the digital distribution of (life insurance) products up to the seamless integration of underwriting engines to allow for end-to-end straight-through processing.

6. What’s on your bookshelf/ reading list?

I am a passionate reader since early childhood – but do not always find (or take myself) enough time to do so. However, in the past few months I have been indulging in reading on a more frequent basis as I find it an effective way to sometimes distract my head from work.

My interests span from (crime) novels, thrillers and books dealing with specific business topics. The following is a short list of pieces I already found great pleasure in reading or still plan to do so:

Nine Perfect Strangers (by Liane Moriarty)

The Tattooist of Auschwitz (by Heather Morris)

The Barcelona Way – How to Create a High-Performance Culture (by Damian Hughes)

Insane Mode on Elon Musk and Tesla (by Hamish McKenzie)

Venture Deals (by Brad Feld & Jason Mendelson)

7.  Your favourite place for a coffee and/ or a drink?

There are a couple of cafés and bars nearby our office in Zurich that I like quite much. Because of COVID-19, however, I haven’t had a chance to visit any of these locations for quite a long time. But my favourite spot is our garden at home – both for sipping a good cup of coffee (preferably an espresso macchiato) on a sunny morning or enjoying a glass of wine in the evening when having a BBQ in good company ore reading an exciting book.