Addenda - a B2B startup - streamlines processes between insurance companies and has tailored tasks reported in real-time on a user-friendly interface and then time stamped as evidence onto the blockchain. This allows users to report claim movements in a completely encrypted manner. To simplify, Addenda will maintain a network of insurers on blockchain. The startup was officially created in September 2018.
Over 300 startups applied for the FinTech Hive 2018 and Addenda was one of 22 that was picked as a finalist. The startup is being mentored by five insurance partners in FinTech Hive and one banking partner. The firm is targeting two key segments of the UAE insurance market: motor (Dh7.5 billion in gross written premiums last year) and life (Dh7 billion in gross written premiums last year).
"In March, my brother and I decided that we no longer wished to work in our jobs [a civil engineer and an insurance loss adjuster respectively] and began hatching a plan to start our own business. Our obsession with decentralisation and blockchain, along with our experience in the insurance sector, led us to the concept of Addenda: a startup that intended to bring trust back to an industry that was built on it," said Walid, co-founder and project lead, Addenda.
Walid was originally an environmental engineer and certified insurance loss adjuster. He has dedicated most of his free time since 2012 to learning about decentralised technologies. While working in the insurance industry, he was also researching cryptocurrency for Cointelegraph and Bitcoin Magazine.
"There came a point in my previous job where I paused and thought: I would much rather push code than write daily reports. Our original ambition was to create a consumer-facing insurance app, but pivots along the way led us to a new inspiration altogether: building an insurance consortium on the blockchain."
Karim (co-founder and business lead), an industrial engineer by profession, started his career as a liaison engineer for engineering consultancy CH2M. Using his engineering knowledge, he soon found himself working as the head of operations for TMS, a traffic management startup in Qatar.
The duo came across a FinTech Hive application post on LinkedIn. "We read through the requirements and found out that the application deadline was only a week away. This caused us to go into overdrive: we worked day and night on launching our website and preparing a prototype fit to pitch to the accelerator's partners. Our evolution in the past few months has been humbling. We got our company incorporated in DIFC, hired a tech lead and led a panel discussion in the 5th annual health conference," added Walid.
Addenda has been self-funded by its two co-founders since inception and is raising between $500,000 and $700,000 in its seed round and approximately $1.5 million to $2.5 million by Q1 2020.
The firm will announce on November 27, 2018, more about its first seed round on the FinTech Hive Investor day. The startup has been approached by angels earlier in the FinTech Hive programme but were asked to wait until the firm's prototype was ready.
How is Addenda different from its peers in the UAE? "We believe that our in-depth understanding of blockchain, coupled with our problem-solving capabilities, will allow us to have fresh eyes on age-old problems in the insurance industry. This is how we stand out. There's a legend about Tariq Ibn Ziyad, a Muslim commander who led the Islamic Umayyad conquest of Visigothic Hispania in 711-718 A.D. Allegedly, Tariq ordered his troops to burn their boats the moment they landed on the shores of Spain to prevent any notion of going back on their plan. We say this because even before knowing whether we made it to the Hive, we agreed to quit our jobs to prevent any chance of turning back on our startup idea," said Walid.
"We intend to hire a few more developers and deploy our insurance consortium prototype as a live blockchain solution in the UAE. If all goes well, we hope to on-board at least four new insurance companies onto the platform. As for Q2 2019, we are considering the same proposition in the Saudi Arabia market."
The startup will be operational by December end. "We started Addenda with a simple idea in mind: improve the image of insurance through disruptive technology. The industry's current extreme risk aversion is not one person's fault, but more the miscommunication of people talking across each other - underwriters, senior leadership, claim handlers and data engineers. Addenda offers to be the startup who connects the dots, making sure everyone is on the same page - which is not always easy when it comes to insurance companies and their related processes because they can be highly complex, or else they can appear to be so," concluded Karim.
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