Mark Shaw likes to run.
The serial entrepreneur joined the activity and fitness tracking platform Strava as a co-founder in 2009 to lead engineering as a CTO. He spent eight years there and, since its last raise in 2020, Strava had reached 70 million members worldwide and amassed an almost cult following among its users, which includes professional runners looking to keep track of their users. progress.
Prior to that, Shaw helped start the Guidewire insurance software company. Once again, she helped the company grow to a different level with her engineering, analytics and marketing skills before it went public in 2012.
After a brief hiatus from those two stints, Shaw teamed up with Josh Wyss and Graham Gerlach in 2020 to start his third company: Inclined. The fintech startup is growing in its own right, even if it has not yet reached tens of millions of users or has gone public. And it just raised $ 15 million in Tier A funding to continue growing and developing its technology.
Inclined, Shaw admits, is a very different type of company from Strava. The startup lends against whole life policies, with the aim of digitizing “many of the traditional time-consuming operations ”involved in the process, he said.
“There is a trillion dollars worth of cash in a lifetime in the United States alone,” Wyss told TechCrunch. “We want to take advantage of this great opportunity”.
The current loan market today at $ 1.1 trillion is $ 150 billion, and that’s Inclined’s initial goal.
“We believe we can increase the loan rate with our improved rates and efficiency,” said Shaw.
Hudson Structured Ventures led Inclined’s Series A funding, which included the participation of Anthemis Group and other new and existing backers. The startup has raised a total of $ 19 million since its inception in 2020.
The startup’s A league was raised in what Shaw described as “the most brutal fundraising environment” it had experienced in the past two decades.
“Ours is a countercyclical business and a very safe form of lending,” he told TechCrunch. “This is a time when people need to access these loans. It is the right time to grow: we can have a great impact in these unfortunate and difficult times ”.
Whole life insurance policies differ from term life in that accumulate available value permanently, instead of just paying for coverage. Shaw likes to buy rather than rent a house.
And when full-life policyholders want to access their cash value, they often choose to do so through a loan, rather than withdraw the money directly, which is less efficient, he explains.
Incline, he adds, not only opens up the possibility of borrowing against whole life insurance policies for more people – something that has historically been reserved for the wealthy – it also offers banks a way to better participate in the large-scale market. And because banks often have “much lower rates than insurance companies,” Shaw explained, that means borrowers can borrow at lower interest rates. Furthermore, their money can accumulate over the course of decades.
“That means they can realize five to 10 times more value from their life insurance over their lifetime,” Shaw told TechCrunch.
Incline is live with Mechanics Bank, which has approximately $ 20 billion in assets under management. And it currently has several million dollars on its platform.
Vikas Singhal, founding partner of HSCM Ventures, believes that Inclined involves four “distinct but important components” in a single digital-enabled financial transaction: insurance companies, agents / brokers, lenders / banks and policyholders.
“The financial transaction offers immediate value to the end customer – a contractor who has already borrowed lowers the cost of the loan – but also provides very much aligned and equally important value to all other components,” Singhal wrote via email. “This is the best financial democracy. Although the refinancing of existing policy loans has been underway for some time, it has not always been accessible to everyone and a digitally enabled turnkey solution gives everyone the opportunity to take advantage of it. “
His company also sees Inclined’s offering as just the starting point.
“The cash value within permanent life insurance products is an underutilized asset and we believe the entire market can benefit from banking products built on it as a foundation,” added Singhal.
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