InsurTech Parametrix raised $17.5m in funding from VC firms FirstMark Capital and F2 Ventures to offer insurance policies for companies that rely on third-party cloud providers, e-commerce services, payment gateways and CRM systems.
Founded by CEO Yonatan Hatzor, CTO Neta Rozy, COO Ori Cohen and Tamir Carmel, the firm will use the funding to accelerate global expansion – directly as well as through Parametrix’s network of insurance brokers and boost its recruiting to expand the company’s R&D centre in Israel.
The company’s insurance offerings protect businesses from financial damages incurred during outages caused by third parties such as cloud, e-commerce and payments, service providers. Parametrix’s offering ensures that companies with mission-critical services in the cloud can quickly recover from IT downtime events. The system collects millions of pieces of granular data points and metrics every day, with detection capabilities down to the millisecond.
When cloud providers, ecommerce services, payment gateways and CRM systems go down, customers suffer both financially and operationally due to significant direct revenue losses, expenses related to reputational damage and diminished productivity. This is what the firm aims to solve. And it does so by partnering with incumbent insurance carriers to pay out customers.
One key differentiator is the firm’s pricing model. The company’s parametric offerings payout in full within 15 days when downtime triggers are met, without requiring customers to go through lengthy claims adjustment processes or restricting them in terms of how they use the funds.
Commenting on the firm’s future plans Hatzor said, “The business world’s dependence on cloud solutions is rapidly accelerating. To help them hedge this external risk, we created a new category in the insurance market by introducing reliable protection from the cloud downtime incidents that inevitably occur.”
The funding also marks the first investment FirstMark has made in Israel which has previously invested in the likes of Airbnb and Shopify. FirstMark partner Amish Jani added that, “Parametrix has built an incredible platform to monitor third-party cloud platforms at an extremely granular level. Having seen first hand the impact of downtime within our portfolio, we believe cloud downtime insurance will become a core part of every company’s business continuity plan.”
Echoing a similar sentiment, F2 Venture Capital managing partner Jonathan Saacks added, “Parametrix has created a first-of-its-kind insurance product for a huge and growing market. The acceleration of digitization and online services means Parametrix is well-positioned to be the leading company of this market.”
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