Seed (Seedrs)

INVESTMENT
DECK

January 2021

CONFIDENTIAL

gethiro.com
 CONFIDENTIAL
The Problem

At $6.9 trillion, insurance is the single biggest industry in the world. There are more
insurance policies than people. The UK alone is worth £175bn. But if you talk to
customers, they’re almost universally dissatisfied.

Only 1 person in 10 trusts their insurer - and that’s according to the industry’s own
representative body, the ABI. 7 in 10 people think their insurer actively tries to cheat
them. The industry average NPS score is just 13 out of 100. It’s a trillion-dollar industry
that’s ripe for disruption.

And it’s hardly surprising that old insurers are struggling to deliver. 65% still rely on tech
stacks built in the 1980s or even ‘70s. An average insurance workflow contains three
manual, duplicate processes. 86% of insurers say fax is a critical part of their business.
Insurance hasn’t innovated in decades, but their customers live in a world where our
expectations are set by slick, personalised, on-demand services like Amazon Prime,
Netflix and Uber. 80% of those customers say they want their insurer to modernise their
service by bringing in features like smartphone apps or pricing personalisation.

Insurers are being left behind, and creating a demand vacuum that can be filled by
forward-thinking, tech-first providers like Hiro: providing more, for less; instantly and on
demand - by harnessing the affordable, accessible and powerful technologies that now
surround us.

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 CONFIDENTIAL
The Solution

Insurance wasn’t originally about reflexively throwing money at
problems. The first home insurance companies also owned and
operated the world’s first professional fire brigades. They were
founded after the Great Fire of London, and the headline feature of
“home insurance” was a dedicated fire brigade that would come to
your house and help you put the fire out.
We will use a gamified in-app mechanism to actively coach users
to be less risky, by completing simple tasks like testing smoke
alarms and replacing their batteries, checking the sealant around
showers, or clearing the lint from tumble dryer filters to prevent
fires. This will be augmented by professional services such as home
health check to spot problems early - before they become a claim.

That was 350 years ago - today we have smartphones, smart cameras, All of these introduce multiple new digital touchpoints, improving
video doorbells, connected smoke detectors and plenty of other smart user engagement, satisfaction, loyalty and retention.
tech that can detect, stop or mitigate many bad things before they
become an insurance claim. They’re affordable, they’re powerful, and
they’re now so popular that 57% of UK homes already have one of
them installed.

Welcome to Hiro!

We reward customers who have invested in smart technology with a

fairer, personalised insurance. Our Quote & Buy journey taps into
external data sources to avoid asking 50+ questions - we can provide a
quote in less than a minute and we ask only a few questions.

Customers can also buy more smart technology to protect their

home from an in-app marketplace. We work with leading
manufacturers to secure member-only deals, adding day-to-day value,
and crucially, decreasing our risk with every device installed.

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 CONFIDENTIAL
Addressable Market

The global insurance market is worth $6.9 trillion.

The UK insurance market alone is worth £175 billion.

We have identified an opportunity to enter this global market by initially focussing on the UK home insurance segment.

€ 105 billion $ 109 billion

The size of the EU property The size of the US property
£ 5.5 billion insurance market (~£89.5 billion). insurance market (~£83 billion).
The size of the UK home
insurance market.

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“70% of customers would prefer the option
to interact with their insurer via an app”
- YouGov Survey

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Product

Traditional insurers get three touchpoints in the whole life-cycle – the point of sale,
renewals and (if they’re unlucky) a claim. A bill once a year is not an easy way to win
hearts and minds.

Hiro members get value whether they claim or not - like deeply discounted access to
the best tech to protect their home, and enhance their comfort (something that’s only
becoming more popular as we’ve spent the last year locked inside). And through that
technology, they have the ability to check up on their home from anywhere in the
world; or to automate their lights when they go out and “simulate occupancy” to
deter intruders. Old insurance is a static piece of paper you file away and forget. Hiro
is an engaging, interactive framework onto which we can hang reward schemes,
e-commerce, community, news and events, user-generated content and educational
guides.

If customers do need to claim, it’ll be a similar experience to sending a WhatsApp

message - chatting to agents and snapping photos and videos on their smartphone
to show the problem. We’re integrating machine learning to our workflows to
answer simple questions automatically and near-instantly - and in the future, maybe
even settle claims on the spot.

An early review of Hiro described it as “more like Uber” than the dusty, paper-bound
insurance processes of old.

CONFIDENTIAL 6
 CONFIDENTIAL
Product

● Monthly subscription. Why get tied into a 12-month

contract? Start and end whenever you like: no
cancellation fees, no admin fees, no nonsense.

● Human, not hieroglyphics. Hiro policies are written in

natural language that everyone can understand.

● Great cover at a great price. The underlying policy is

carefully tailored to provide solid cover at a very
competitive price.

● Personal and fair. Why pay more because of someone

else’s risk? Hiro policies automatically reflect the
safety-focused smart tech in your home with a discount.
In the future, we hope to offer insurance that’s truly
personal to you.

● Innovative options. Want cover against cybersecurity

attacks? On-demand cover for your AirBnB? Our aim is
to listen closely to our customers and roll out new kinds
of cover, personalised to your needs.

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“Telematics data is up to 10 times more predictive
than traditional factors when evaluating risk.”

- IMS & Nationwide

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 CONFIDENTIAL
Product

Underpinning all of this is a class-leading insurtech platform

which includes a custom-built Ratings and Pricing Engine,
Policy Admin System, backend and frontend apps and will soon
include Claims and Preventative Maintenance Coaching
modules.

The backend is composed of modular Ruby and Elixir

microservices allowing us to offer an end-to-end menu of
services to commercial partners. The technology is highly
extensible, and unlike many IoT or insurance players, we own
the full stack - giving us the flexibility to integrate smoothly
with partners and react to changes in the competitive
landscape.

Owning the whole tech stack means we can move at lightspeed

compared to incumbents. Rolling out support for new products
– either our own, or third-party – is a matter of weeks, not
months.

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60% of insurance customers would prefer to share their
personal data - including access to their social media profile
- for a fairer insurance quote.
- ABI and Britainthinks

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 CONFIDENTIAL
Product

The three leading causes of insurance claims in the UK are water leaks, burglaries
and fires.

Smart smoke alarms help to raise the alarm faster, which, considering fires
multiply exponentially, can be crucial in limiting their spread.

Burglary mitigations can use native security products like video doorbells, or they
can mean harnessing other devices into “mockupancy” schemes. Smart lights, for
example, can be automated to turn on and off to simulate occupancy and deter
intruders. Smart speakers, like Alexa, contain microphones that can listen for cues
like breaking glass or ‘hear’ standard smoke alarms going off. Through integration
with Hiro, they will also be able to respond with pre-recorded clips such as
barking dogs or voices, to further deter intruders.

Water leaks, which make up 31% of all claims, can now be detected and stopped
by smart leak solutions.

All of the smart tech that can help us reduce the claims ratio and make homes
safer and more secure is available through the Hiro App - heavily discounted for
our customers. These products will be carefully curated and recommended to
customers by our machine learning based on their profile - in a similar way to
recommendations from Netflix, suggesting content relevant to you.

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The security & insurance industries were voted joint first
to manage the connected home – above even internet giants.
- Morgan Stanley & BCG

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Traction

Expert team who already built & sold Dozens of partners signed-up
a multi-award-winning insurtech - Marketplace and distribution

Secured backing from VC and veteran

Comprehensive insuretech platform built angels from within the industry

5,000 waiting list FCA registration achieved

Underwriting partners selected

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Traction

A selection of the world-class brands who have already partnered with Hiro.

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 Roadmap

Introduce
other products
and consider
Scale up in the UK new verticals

Full UK Gamified Professional API-based & evaluate

services inc. Home entering EU and
launch coaching integration with 3rd
US markets
Health-check party devices

2023
2021 2022

This is just a selection of the most critical milestones. There are multiple
other objectives that we will be focusing on, including innovation in
product features, claims management and fraud detection.

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Why now?

Smart home has enjoyed a phenomenal surge in popularity in recent

years. 57% of UK homes now have at least one smart device, and the
number is rising rapidly. The technology has truly “come of age” and
earned its place at the heart of the home. It’s useful, powerful, trusted and
now almost totally ubiquitous.

With it has come a sea change in attitudes. Consumers are far less wary
of connected technologies. IP cameras, for example, have reinvented
themselves from “Big Brother is watching” to something we willingly use
to monitor babies, check up on our pets, or put on our car dashboard as an
extra safety measure.

The meteoric rise of car telematics is concrete evidence that people are
ready for fair, usage-based insurance based on how they actually drive,
not a historical stereotype.

US-based Root, for example, grew 824% in 2019 alone and IPO’d at
$6.34 billion. And perhaps most interestingly, 78% of consumers said
the technology changed their experience for the better.

The market is now ready - and hungry - for what we have built.

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 CONFIDENTIAL
Marketing Overview

Initial Target Audience:

● Attitudinally: Technology enthusiasts

● Age: Gen Y+ (25-45 yrs)
● Financial status: mass affluent - household income of £75k+ p/a
● Location: London and SE of England
● Homeowners: Yes
● Property value index: 110 - 750 (100 = UK mean)

As one of the first “smart insurers” to market worldwide, we recognise

the need to generate awareness (and ultimately sales). Data-led
backtesting will be key to driving customer acquisition cost efficiencies,
but we expect that the majority of our customer acquisition activity and
spend will revolve around:

- Community building & social media

- Content / inbound marketing
- Experiential marketing
- SEM (PPC, SEO, ASO)
- PR
- Affiliates (e.g. smart tech manufacturers, security & smart home
installers, property developers, financial service providers)

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Affluence is the most predictive factor in technology uptake -
even above age.
- CapGemini

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 CONFIDENTIAL
Revenue Model

Insurance Commission

Professional Services
(preventative home health check, professional
monitoring & emergency assistance)

Smart Marketplace
Hiro has three primary
revenue streams
White-label and PaaS opportunities will be evaluated as they arise.

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 CONFIDENTIAL
The Most Critical Factor -

Only 6% of customers say they’re loyal to their current insurer. Customer Lifetime Value
HIRO vs Average UK Insurer
A few UK insurers, in the HNW segment, achieve retention rates of Assuming £70 CAC
about 80%. However, the average retention hovers around just 62%
(translating to 2.6 years of Customer Lifetime Value), fuelled as
much by inertia as anything else.

By offering customers something meaningfully different -

insurance that benefits them every day, not just if they need to claim
- we can deliver 90%+ retention.

Ninety percent retention translates to ~10 years of CLV, quadrupling

the lifetime value versus traditional, legacy insurers.

Factoring in the benefits of reduced claims from smart technology

and behavioural coaching, better overall risk selection, the actuarial
edge of real-time data, extensive automation of simple processes
and a host of other efficiencies, as well as the additional revenue
streams from our Smart Marketplace and Professional Services - our
model suggests a six-fold increase in lifetime value is realistic.

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Financial Forecast 3 YEAR FINANCIAL FORECAST
GBP ('000)

Revenue 2021 2022 2023

Insurance (commission) £421 £6,562 £13,123
Insurance (profit share commission) £0 £64 £928
Smart Marketplace (commission) £63 £564 £1,127
Professional Services (commission) £50 £904 £1,808
Total Revenue £534 £8,094 £16,986

Expenditure
Research & Development £793 £2,393 £4,787
Sales & Marketing £2,347 £9,272 £13,590
General & Admin £584 £816 £1,225
Other (inc. CX, infrastructure, outsourcing) £250 £814 £1,628
Total Expenditure £3,974 £13,295 £21,230

EBITDA (£3,440) (£5,201) (£4,244)

EBITDA (cumulative) (£3,440) (£8,641) (£12,885)

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Leadership Team
Krystian Zajac
CEO & Co-Founder
Krystian is a serial entrepreneur
and co-founder of
multi-award-winning insurtech
Neos, which was acquired by Aviva
in 2018. His ventures have won
dozens of awards and have been
recognised as some of the most
disruptive companies in the world.
Having seen no progress in the UK
since he left Neos, Krystian decided
to start Hiro to focus on
next-generation insurance services
to protect people, the things they
care about, and the environment
from harm.
Daniel Knight
CTO & Co-Founder
Daniel is a young tech star
generally regarded as a
world-class smart home expert.
As well as helping to found Neos
and serving as its Chief Product
Officer, Daniel has worked with
some of the world’s top smart
home brands including including
tech superpower Samsung
SmartThings and Z-Wave giant
Fibaro.
Adam Whistler
Head of Growth Marketing
Adam is the 3rd founding member
of Neos to regroup around Hiro.
He’s an expert in the art of
dirty-hands bootstrapping. In a
decade-long career he has helped
to raise more than £10m for IoT
startups, penned applications that
won dozens of awards and
research grants, and secured
hundreds of tier-one media
appearances for under-the-radar
brands.
CONFIDENTIAL
Hamza Abbas
Partnerships Director
With a highly successful career
spanning from luxury electronics
through virtual reality to insurtech
and even specialist metallurgy, it’s
fair to say Hamza is somewhat of a
technology magpie. He lives and
breathes the latest developments
in the tech space, and his extensive
knowledge and technical outlook
make him a well-respected figure
in the world of Smart Home
Technologies.
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Non-execs and Advisors
Danny Maleary
Non-exec Director
With 30 years of industry
knowledge and 20 dedicated solely
to building and scaling MGAs, it’s
fair to say Danny is a world-class
expert when it comes to MGA
incubators. Danny oversees Pro
MGA Solutions, a global incubator
platform with regulated offices in
the UK, US and Europe, and over
$500m GWP under management.
He also sits on the board of the
British Insurance Broking
Association and is a mentor at the
prestigious Lloyds of London &
BIBA Insurtech Labs.
Will West
Non-exec Director
Will is a renowned tech
entrepreneur and co-founder of
one of the world’s most valuable
publicly listed smart home
company, Control4. He has
successfully raised more than
£300m in private capital across
multiple ventures and is a regular
fixture in the tech media circuit.
He brings with him a relevant
aptitude for scaling ambitious
tech startups into highly
profitable enterprises.
Steve Moore
Commercial Advisor
Steve Moore is a well-respected
figure in the IoT industry who has
delivered custom technology
solutions for Apple, Ford, HP,
Orange, Virgin Atlantic and many
more. Steve serves as an advisor
for Ring video doorbell (now
owned by Amazon) - one of the
most successful IoT products ever
- and spearheaded Dixons
Carphone’s successful move into
the connected home industry.
Steve is an expert in demystifying
smart home for a mainstream
audience.
CONFIDENTIAL
Chaim Coutts
Insurance Advisor
Chaim has nearly 20 years’
experience in the global
insurance market, spanning all
lines of business from personal
to commercial lines; traditional
and non-traditional. He also has
a flair for delivering on novel
insurtech propositions, with a
solid track record of successfully
spinning up large Insurtech
PoC's in collaboration with major
insurance carriers in the UK, US
and Middle East.
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an incredible team

Andrii Nasreen Ruben Ela Marcin Wiktoria

Tomek

Jakub Kirsty Joel Tomek Sonia

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 CONFIDENTIAL
Our people come from

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 CONFIDENTIAL
Competition Analysis

Headquartered in the US, Lemonade is a
technology-first insurer that uses AI and
automation to slash overheads (and
therefore prices). It also leverages a
behavioural economics model, where
most of the profits are donated to charity
to reduce fraud and demonstrate that they
have no incentive to avoid paying claims.
Lemonade is already present in Europe -
in Germany, Netherland and France. They
don’t integrate with smart devices and
focus mainly on renters’ insurance but if
they enter the UK, their product could
well resonate with consumers.
A US-based insurtech, Hippo bundles
white-labelled smart devices with
feature-rich insurance. They have grown
very fast and have a healthy business
model (their annualised premium is much
higher than that of Lemonade). They
recently went on a shopping spree,
snapping up Sheltr (a preventative
maintenance start-up) and Spinnaker,
their own underwriter. Their primary
focus is expansion in the US as they still
don’t cover all the states, but it is likely
that they will start moving to other
territories soon after.
WeFox’s direct-to-consumer arm
One Insurance leverages big data
and machine learning to reduce its
loss ratio to just 40% (an
industry-standard loss ratio is
around 60%).
WeFox Group reportedly services
around half a million customers in
Europe, and is currently active in
Germany, Austria, Switzerland and
Spain. We have reasons to believe
that they are evaluating entering the
UK market.
Founded in 2017, this French startup
provides customers with door and leak
sensors and electric meter monitors to
help protect their homes. The company
also branched out into key custody and
electric scooter insurance. Luko raised
€2m in 2018, €20m in 2019 and then
€50m in Dec. 2020 on an undisclosed
valuation. They managed to secure
100,000 since their launch in 2018. We
believe that they will want to enter the
UK in the near future.

Other neo-insurers Old / incumbent insurers

Start-ups such as GetSafe, Bought By Many and By Miles are not seen as direct
competitors as they don’t integrate with smart tech and don’t use advanced ML or AI
tech, but they do remain on our competitive radar. Startups are agile and can pivot. Our
IoT expertise and relationships with smart device manufacturers are difficult to
replicate and represent a sizeable moat to conventional insurers.
While incumbents are renowned for their inability (and reluctance) to innovate,
they do have deep pockets are are known for “fast-following” proven trends. Aviva,
in particular, pursues an aggressive agenda of acquiring promising startups for
their tech. Our main advantage at this juncture is our superior agility - as outlined,
we can currently move at orders of magnitude faster than incumbents.

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 CONFIDENTIAL
Investment Case

We are seeking between £1.2m and £1.5m

to launch our insurance services in the UK
at a pre-money valuation of £5.5m on a
fully diluted basis (including a 10% share
options pool).

We aim to raise another £15-20m in the

next 12-15 months and anticipate further
rounds in the next few years.

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 CONFIDENTIAL
Valuation Potential

Location: USA Location: USA

Year founded: 2015 Year founded: 2015
Valuation: $9 bn Valuation: ~$2 bn

Location: Germany Location: USA

Year founded: 2015 Year founded: 2015
Valuation: ~$2 bn Valuation: ~$6.5 bn

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Exit Opportunities

We believe there is significant value to be found in a fresh, digital

insurance brand that is able to adopt new technologies, engage
customers consistently throughout the product lifestyle (and give
them a reason to stay) - all while gathering real-time insights for
best-in-class actuarial science.

Hiro offers potential for significant capital appreciation as part of

a medium-to-longer-term investment strategy.

There are a number of potential exit scenarios:

- Sale to private investors as part of future investment rounds

- Sale to existing insurers or related businesses
- Sale to tech players seeking an entry to the insurance market
- IPO.

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 CONFIDENTIAL

As seen in

this

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Krystian Zajac

krystian@gethiro.com
+44 7810 878289
gethiro.com