Insuring Africa's Future: Expanding Affordable Insurance Coverage Across Africa with Ted Pantone

[00:00:00] You're listening to the Unlocking Africa podcast. Welcome to the Unlocking Africa podcast where we find inspiration. Today we have Ted Pantone who is CEO and founder of Duraco, a Pan-African insure tech company that provides simple and affordable insurance to underserved customers.

[00:01:21] Welcome to the podcast Ted, how are you? Hi Terser, doing great thank you. Fantastic, it's a pleasure to have you on the podcast today. How's your day going? Yeah, great day. This guy is sunny here in Nairobi so life is good. Brilliant, brilliant.

[00:01:39] So I know you've probably listened to the podcast before or I know you have. So I like to start off in the beginning so I was hoping you could introduce yourself and tell us a bit more about Ted Pantone. Yeah, happy to share.

[00:01:52] So I am originally from California. I grew up there and moved to East Africa when I was 23 to do some charity work with the Gates Foundation project in Western Kenya thinking that I was going to come to Kenya

[00:02:09] and be here for a year and then go back at my MBA and move on with more regular life but God had other plans and I'm very happy that he did because I thoroughly enjoyed getting to build a life and a career here in East Africa.

[00:02:22] So lived in East Africa for 14 years. My kids were born here. We love it and yeah, we've had the chance to build a couple of businesses as a family and this latest business, Turaco has been by far the most exciting

[00:02:38] and kind of the closest business to my heart of why originally came over here to try and help people in every product that we sell is impactful and meaningful in people's lives and at the same time it's also a pure like business

[00:02:54] opportunity that's venture backed, highly scalable, unable to have kind of significant scaled impact across the different markets where we work. So yeah, that's a little bit about me. Family man married four kids. They're they're my greatest entrepreneurial adventure. Tricking out to be a good dad to them.

[00:03:12] And yeah, I really have enjoyed your podcast. So thrilled to be here and I'm looking forward to the conversation. Fantastic. Thank you for that Ted. So as you mentioned, you're originally from California, lived in Kenya for 14 years. So what is it actually kept you in Kenya?

[00:03:30] As you mentioned, you didn't think you would be staying as long as you have. So what's kept you in Kenya for 14 years? I love it here for so many reasons. I think one of the most interesting and maybe relevant for those listening to

[00:03:44] this podcast is just that the business climate is still full of opportunities that are untapped, right? One of the businesses that I started was a Pizza Hut franchise, which if I had started a Pizza Hut franchise in San Diego, California, where I grew up,

[00:04:01] it would have been a little bit boring, right? There's a lot of international restaurants. But when we launched the business in Uganda seven, eight years ago, something like that, we were groundbreaking, right? We were like a transformational business for the market.

[00:04:16] So I just think that's kind of a silly example. But certainly we're building a Toronto doing insurance for the masses. I mean, vast majority of people don't have insurance. Nobody had access to good pizza or at least an American version of good pizza.

[00:04:32] I think probably my Italian grandfather would roll over in his grave if you hear what I just said. But I think what I've found in East Africa and now I'm doing business a bit more broadly across other parts of the continent is if you have

[00:04:47] a lot of resilience and a lot of creativity, you can have a business life here that is unlike anything where I grew up. There's a lot more challenges, obviously, but I think there's actually a lot more opportunities to because it's it's not a place most people are willing

[00:05:04] to stay. I mean, even many of my Kenyan, Ugandan, Nigerian friends, as soon as they have the opportunity to leave and go to UK or go to states or Canada, they take it. I'm trying to convince them all to come back because this is where the opportunities are.

[00:05:18] But that's another conversation. Maybe you're a different podcast than this one. Definitely, definitely. It's a conversation I have quite often as well. So you mentioned that the business climate is full of opportunities that are still untapped, which has led you to the opportunity that you're currently exploring.

[00:05:35] You're the CEO and founder of Turaco. Can you tell us a bit more about Turaco and what you're doing? What you hope to achieve? Yeah, happy to. So Turaco is an insurance technology company that is focusing on solving the problem of distribution of insurance

[00:05:56] for mass market consumers in the developing world. So this is the majority of people, 90 plus percent in Africa have never had an insurance policy in their lives. And it's a huge untapped market, a huge opportunity and also a huge social problem, right?

[00:06:14] Where people don't have the financial safety nets that they need to be able to kind of weather the storms of life. It makes metaphor there. But practically speaking, people face a lot of risks in life and are probably more aware of them than anywhere in the developing world.

[00:06:31] Like in the markets where we operate in Kendi, Uganda, Nigeria, and Ghana and not having formal financial tools to be able to manage and mitigate the risks that they face is just a huge gap, a huge missing piece of people's ability to create wealth,

[00:06:49] have peace of mind and really advance along the kind of aspirational goals that they have to to better their families. So that's really what we're looking to do is distribute products to the people that do not have them.

[00:07:05] And so far, we've been by God's grace very successful at doing that. We've ensured more than 1.2 million people, so more 1.2 million customers across those four markets that I just described and paid tens of thousands of claims and really been transformational in many people's lives.

[00:07:26] The stories are are many and deep when you when you talk about someone who really if they didn't have the products that we're selling to them and there's a sickness in their house, right? The options are you look in your wallet, you look around to your neighborhood

[00:07:43] and if you have money available in your community or in your in your in your pocket or in your assets, then then you can afford to go to hospital. But but oftentimes the case is there's just not money available. So you delay, you don't go to hospital

[00:07:58] until you either you're really, really sick or until something worse happens. So we're really trying to transform that whole mindset of, OK, let's forgo a little bit today so that when that financial shock happens, which we all know it will happen,

[00:08:16] we can be prepared as a family to be able to weather it. So that's really what we're looking to build. So you mentioned obviously, Trucco aims to solve the problem of distribution of mass markets, insurance and developing markets.

[00:08:29] So if we take a few steps back, what was the actual inspiration? What was that kind of aha moment where in terms of the inspiration behind Trucco? Yeah, great question. So I had in a previous business, I built a microfinance bank in Uganda,

[00:08:48] so lending money to businesses, small businesses that needed growth capital that weren't really totally bankable yet. And I really understood the problems there on the finance side and I had watched this industry of microfinance grow dramatically over the years.

[00:09:04] Right? If you look 20 years ago, there was almost no microfinance in the world. There was just a few concepts that have been started by some grant capital and they proved out a bit of a business model, a bit of a concept. And then over the last 20 years,

[00:09:19] it's exploded into a multi-billion dollar asset class where every bank on the continent has some kind of microfinance focus to what they're either doing or will do at some point in the not too distant future. And I had never really thought about insurance, to be honest.

[00:09:35] I don't have an insurance background, but the first time I heard about the concept of microinsurance was actually someone was trying to recruit me to join their business to help them figure out how to make the microinsurance business model work.

[00:09:48] And that first conversation, I just had this massive aha moment of, oh, wow, insurance is just 20 years behind banking. And this is going to be a huge opportunity and a huge business if we can really crack this nut and really solve it in a compelling way.

[00:10:06] And I woke up the next day. I want to ensure a billion people let's go. Yeah, I have been have been on that road ever since. So it's it's maybe a little bit more cognitive than it is like social spiritual on this one.

[00:10:20] But I definitely understood the problem through the lens of of having many, many friends who for years I've been their insurance policy. Right? They went something goes wrong in their life. They give me a call and they say, hey, Ted,

[00:10:35] I know you have money. Can you help me through the situation? So I've been the insurance policy for many medical claims and many life claims. OK, and everything over the years. So as soon as I understood, oh, yeah, really, this should be a business.

[00:10:49] This shouldn't just be you have a wealthy friend and that's how you solve it. So I yeah, I just grabbed on to the idea really quickly and have been have been actively building it since then. Everybody can't have a wealthy friend.

[00:11:02] That's that's not an equitable solution to the problem. So very yeah, that's a little bit of a little bit of the story. Brilliant. So through launching a microfinance bank in Uganda, you identified there was a gap in the market for what you wanted to offer.

[00:11:15] So in terms of that gap in the market, what opportunities do you see in terms of Trucco its ability to disrupt the insurance industry on the continent? It's a great question. So insurance is not a new concept in any way, shape or form on the continent. No, right?

[00:11:35] In every single country, there are many insurance companies. In fact, in Kenya, I would argue there's probably too many insurance companies. OK. The problem is they're all focused on the same top five, 10% of the market. Right. So they don't really think about the mass market.

[00:11:52] They don't really think about the common people when it comes to the products that they design or the way that they distribute them. And it takes a different way of working, a different way of thinking. Right.

[00:12:02] So if you're going to sell a product for one dollar compared to a product for $100, the systems that you need to have in place to sell that $1 insurance product need to be incredibly efficient. You need to have almost no human involvement either in the policy

[00:12:19] administration or claims administration. So you need a much heavier tech play than what traditional insurance requires the traditional agent selling insurance model, which is what's mostly done on the continent today. So we're coming in and we're saying, OK, we don't have any of this legacy system.

[00:12:35] We're focused on the mass market. We have no need to sell to the wealthy people or businesses in the country. So we're not trying to cannibalize anybody's business. So we're not really directly competing with anyone or operating in a market where there's little competition, massive need.

[00:12:50] And probably the most surprising thing to me is a massive amount of demand too. When I started into this, if you had asked me how many out of 100 farmers if you asked them would want to pay for an annual life in medical insurance policy,

[00:13:06] I would have guessed maybe 10 percent, maybe 10 farmers. Reality is what we're finding is more than 50 percent of farmers in a very real example where we're selling just cold calling farmers within this one partnership are opting in to pay for this policy.

[00:13:21] So demand is not the issue at all. It's really just connecting the dots of, OK, what are the right products? How do we efficiently deliver them to the market and make it so that people can get the care that they want in the places where we're selling?

[00:13:35] So you mentioned something quite important, which is that most insurers in Kenya don't think of products for the mass market. So if we look closer at this, why do you believe this is the case? Why do you believe this has never been done before?

[00:13:50] Yeah, it's I think the the majority of legacy insurance companies they've built their business around doing business the way they know how to do business. Right. So this is true in any industry of all time, right?

[00:14:04] The legacy players have a lot of inertia doing business a certain way. Right. So in insurance, they have a lot of inertia in using agents and brokers to sell insurance to businesses and high net worth wealthy people.

[00:14:20] So everything that they've built in their company is designed to do that. And that's where they make their profit margin. And when you tell an insurance company, and we've worked with many, many that are amazing partners for us to have worked with.

[00:14:32] But when you tell them, OK, I'm going to collect one dollar a month from people and pay a fifty dollar claim. If somebody has has a hospitalization stay, they just look at that and they say, I can't make those economics work with the tools that they've built.

[00:14:49] For context, it takes a typical insurance company probably costs them about 40 to 50 dollars to pay a medical claim. It costs me 10 to 50 cents to pay a medical claim, right? In terms of the cost to actually process it. So that's just a whole multiple orders of magnitude difference

[00:15:09] that makes it possible for us to serve the mass market, really driving it through technology, through learning algorithms, through doing business in a way that these insurance companies just have not been able to operate because they haven't built the same kinds of tools that we've built.

[00:15:25] So I think if you fast forward 10 years from now, every successful traditional insurance company on the continent will have micro insurance as a part of what they're doing. And they will either have partnered with somebody who has built

[00:15:41] the right tools or built the tools themselves or acquired a company that's built the right tools to be able to serve this segment of the market that's really the last growth opportunity for them, right? The opportunity to grow in the existing market is really just kind

[00:15:57] of cannibalizing each other's piece of the pie. I'm talking about growing the pie by 20X in terms of the number of people that people are able to reach. So from what we've discussed, it kind of appears that the current

[00:16:10] insurance services in Africa are not suitable for the average person. So from your perspective, what improvement or innovations do you believe are needed in the industry to reach the mass market? So I think it's mostly more efficient systems for policy administration, claims administration like I just described.

[00:16:30] So sorry, that's a little bit boring insurance talk, but that's basically just how you onboard customers and then how you process a claim that comes in. So a lot of that is still very manual at insurance companies.

[00:16:43] And I mean, I was at a conference a couple of years ago and the theme of the conference was digitization of the insurance industry. And it took me about half a day to really understand what everyone was talking about.

[00:16:57] And I boiled it down to they were just moving to using computers. This is the big innovation. This is the big innovation like, OK, we're not going to use paper anymore, guys. We're going to use computers now.

[00:17:08] And I was like, OK, this is a great place for me to disrupt as an innovator because people are still pretty far behind the advanced place that technology is and the advantages that that can give you in terms of delivering products and services very efficiently.

[00:17:25] So I think that's one area is on that side. I think the other area is because of the massive growth on the continent of piece of technology like mobile money and digital banking and digital loan tools.

[00:17:41] I think there is a very new opportunity to embed insurance into transactions that consumers are already going through and doing. And that's a lot of what we've done and our success has been thinking of creative ways to make it very easy for customers to pay for insurance.

[00:18:02] In an ideal world, everyone to have a credit card and you could just collect credit card information to build and process that every month. Obviously, that's not where the market is in East Africa and West Africa where we're working. But because there's all these new financial tools,

[00:18:20] you can kind of mimic that subscription model or a kind of a Netflix way of paying for insurance. That's really effective. And I think we're going to do. I mean, we're going to ensure millions of people in the next 12 months

[00:18:34] through a few partnerships using technology like what I just described. And I think fast forward 10 years, there's going to be hundreds of millions of people insured by us and by other players using similar technologies. Yes, I agree.

[00:18:46] So if we move from the overall industry and look specifically at Chiraco, would you believe that you're adding value or significant value to Africa's insurance industry? So nobody has done what I just described in a sustainable, profitable way yet. We're not the first people to try.

[00:19:08] There were a few other large micro insurance companies that received a lot of grant funding and a lot of investment, quite frankly, in the last decade. But neither of them really succeeded at gaining profitable scale.

[00:19:22] So I think the biggest thing that we're looking to do as a company in terms of kind of creating real impact for the world is proving that you can make money doing this business, right? Proving that this is a scalable financial business model

[00:19:36] that it might not be our company that ensures a billion people. But I think we'll be able to look back. And this is the aspiration of the hope of our business that we can point to the success that we've had at Chiraco being

[00:19:48] the reason that the next billion people are insured on the planet. And I think we'll probably do well over 100 million and maybe we'll get to a billion. But I think proving a real business model for this

[00:20:02] is going to be the transformational thing and the thing we're bringing to the table. Now, in terms of how we're doing that and what new value we're adding, like some of that is proprietary, so I can't share all of that information.

[00:20:12] But the business model of working through amazing partners like Mcopa and Airtel Money and Toukende and all these different microfinance banks, Vision Fund that we've had the opportunity to work through and ensuring their customers and better aligning the kind of real life need for capital

[00:20:36] that their customers have with the risks they face in their lives. I think it's been very meaningful and transformational for those businesses. And we're looking for the next 20 great business partners that we get to work with to be able to distribute insurance through. Thank you for sharing that.

[00:20:52] I think people will be listening to this and thinking, it sounds great, but how do you guarantee that when the time comes, people's insurance claims are paid in time? So what is the process? How quick are people generally paid from the point a claim is made?

[00:21:09] What is the process? So the vast majority of our claims are paid within a couple of hours because it's mostly driven by a very straightforward algorithmic process with a few checks and balances. And we have guarantees within the partnerships

[00:21:25] that claims must be paid within a certain number of days, typically it's three days with our model. So the fun thing to do if you ever get a chance to meet with a Toronto team member is ask them what business that they're in.

[00:21:40] And everyone has the same response, which is they're they're in the claims paying business and that really I deeply believe is going to be the long term differentiator between us and every other insurance company I've ever met. One of the challenges in insurance is the belief that claims

[00:22:01] paid is somehow a bad thing for your company. Right. So it's understandable, right? Insurance companies make profits off of not paying claims so I can get how someone gets there. But if you're not delivering claims, if you're not paying claims,

[00:22:17] well, if you're not having a great customer experience when it comes to paying claims, what are you really doing as an insurance company, you're just taking people's money, right? You're not the actual value you're delivering is in claims paid. So we're passionate about paying claims.

[00:22:30] We believe that that's why we are here and get up every morning is to come alongside people in their times of need and make sure that they are made as financially straight as we possibly can. We've actually transitioned to to being an actual underwriter now

[00:22:44] in Uganda and are looking to that across all of our markets in the next couple of years. So this is where the rubber meets the road on this. Are we really in the claims paying business? Because today we've just been more of a broker,

[00:22:56] but now we're actually it's actually going to hit our P&L when we pay claims. So I and our board and our team remain very committed to keeping that as a part of our ethos, because it's the only way to build a market.

[00:23:09] Right? When you have people that have never had insurance before and if they have a claim and you don't pay it, their experience of insurance is entirely defined by you. So if you screw that up, you're screwing up their belief about insurance forever.

[00:23:24] And I think there's been so many bad experiences in terms of paying claims in the world that insurance is a very bad reputation in many markets. And we're hoping that that can be an entirely different story in Sub-Saharan Africa where we work, where people will say, oh, insurance.

[00:23:40] Yeah, that works. That's a product that we can trust and rely upon. That's a big aspiration, but it's definitely what we're working to build. Brilliant, brilliant. So typically what type of claims do you see from your customers?

[00:23:54] Yeah, so most of our products are hospitalization and funeral insurance products. So if you go to hospital and spend a couple nights, we'll send you a fixed amount of money that covers most of your bill. Or if you were to pass away, we will send your next-of-kin $500, $1,000, $2,000,

[00:24:17] depending upon which policy you were to have purchased. So these are really, we've done a lot of research, a lot of studying. And these are really the most prevalent needs and pain points in people's lives. It's like a big hospital bill or a big funeral bill.

[00:24:34] Everyone that you speak to on the comment knows someone who has been really financially harmed by not being prepared for one of those two situations. And so this is, when you ask people what they want to buy,

[00:24:47] these are the two products that they want to buy the most of. So that's most of what we sell. You slightly touched on this earlier, but I was wondering if you had specific numbers or figures in terms of how many claims you've paid since launching Jericho?

[00:25:03] Yeah, so we've 1.2 million customers. We've paid tens of thousands of claims. And those are the best stories that you can ever have. I always hit them on either a Monday morning or a Friday afternoon

[00:25:16] when I'm either trying to get geared up for a big week or trying to wind down from a big week. But we spend a lot of time with our customers that have claimed and with customers that

[00:25:24] haven't as well, but just really understanding what was their experience and how the impact of having insurance really transformed their situation. There's nothing better than speaking with someone who is well and you know that they're

[00:25:40] well because of the company that by God's grace you were able to start. So that's the most rewarding part of my job for sure. In terms of paying claims and the impact it has on the customers and communities that you serve,

[00:25:52] are there any specific stories that kind of stand out for you? More than I can count, but I'll throw my friend Charles at you. He's a motorcycle delivery driver in Kenya and he had purchased an insurance policy with us. Motorcycle delivery is a very risky job.

[00:26:11] If you're delivering things on a motorcycle, you are I know the math great because that's my job is you're five times more likely to die than an average person. So it's a very risky job. So our products make a lot of sense for them to buy.

[00:26:28] He actually wasn't in an accident. He was tying something onto the back of his motorcycle and the rubber strap slipped and smacked him in the eye and he ended up being hospitalized for quite a long time as he recovered and needing surgery and different things.

[00:26:44] And he is very convinced that if he had not had the insurance with us, that he would not have been able to save his eye. He wouldn't have had the money to do that and his family would have been in a very bad position

[00:26:59] because they ended up having hundreds of dollars of hospital bills and they just didn't have any cash to pay for this. Right? They were they had been building a home for a number of years

[00:27:10] and put all their money there and they managed to sell some assets to cover some of the bill. But if they hadn't had the insurance from Toronto, they would have been in a very different financial spot.

[00:27:19] So I can share stories like Charles for days, but he's become a friend and really appreciate his perspective on how the business really transformed that really bad situation into something that was a lot less bad for his family. Thank you for sharing that.

[00:27:35] It's clear that what you're offering is much needed and making an impact. But what unique challenges or considerations that you have to make to design insurance products for the mass market or low income earners?

[00:27:51] You have to think about insurance and quite frankly, I wish more of the world thought the way that I'm about to describe. But you have to think about insurance not as an insurance person.

[00:28:02] Try and design a product that you don't need to be able to understand legal language to be able to use. So our hospitalization policies, the full terms and conditions on a lot of these policies are

[00:28:17] spend two nights or more at any hospital in Kenya and we will send you $100 or 10,000 shillings, maybe less than $100 with inflation. But that's the full policy wording. We send that to someone in one or two text messages and they have full understanding for how the product works.

[00:28:36] They go to hospital, they spend two nights, they call us, we ask them to send us their receipt and their discharge papers and then we send them money. It's that simple. So insurance in the

[00:28:47] rest of the world is not that simple and people don't even try. I think partially because there's a tendency to not want to pay claims. So yeah, I think the mentality of working

[00:29:00] like that has been really important for us. I think a big shift that we're undergoing right now as a company is, I mentioned this earlier, is changing from bringing a brokerage company to

[00:29:10] being an insurance, a full-stack insurance company. And this is in a lot of ways putting our money where our mouth is in terms of we believe in these products, we believe that the claims

[00:29:21] to profit will make sense for our partners, but we also believe that we want to be able to do things even more efficiently and even more innovatively. So we've now gotten a license

[00:29:31] to be an actual insurance company in Uganda and we've applied in other markets. And it's really interesting how not being an intermediary really matters, right? Really owning the product and having a level of control over how we deliver these products is changing the way that we can

[00:29:49] think about how to design and how to really make things as user-friendly as possible for our customers. So you hit on a key point there, which is about owning the product. So in terms of your

[00:30:02] product, you sell health insurance for less than a dollar per month. So how do you ensure the affordability of your products while also balancing or maintaining the financial sustainability for the company? It's all about two things. One, as I mentioned earlier, just having very

[00:30:20] efficient systems so that our cost is very low. And then the second is just doing good math, I guess in the British version of it. It's shocking to me how straightforward the math actually is,

[00:30:36] but you just have to plan so that based on understanding of how the claims will perform, that you're taking in more money and premiums than you're paying out in claims and then adjusting pricing as needed to make sure that that's optimized. Yeah, we've managed to have very

[00:30:54] profitable businesses not too profitable that I'm uncomfortable. I'm still very much believing that we're in the claims-paying business in terms of the value that we're delivering, but profitable enough that our underwriting partners that we're currently working with, the insurance

[00:31:08] companies that we're intermediary for are going to miss a piece of business that we're that we're going to take over as an underwriter and making sure that you're balancing those tensions of wanting to deliver a good product, but also needing to manage

[00:31:24] profitability is that's a lot of my job. And a lot of our teams focus in terms of really kind of solving the problem that I was just describing is building a profitable model for mass market micro insurance. I guess an important element of selling a product is about

[00:31:42] raising awareness and being accessible. So how have you gone about addressing the perception that insurance is sometimes seen as a luxury, especially in regions or areas where financial resources are limited? Yeah, to the earlier point I shared when we got started,

[00:32:01] I would not have expected the kind of demand that we've seen. What we've seen is that insurance is actually an aspirational product that if people are offered a product that is in a price point that they can afford, the likelihood that they're more than half of them

[00:32:18] are going to say yes, they want to buy it. It is viewed as a luxury product, but I think it's mostly viewed as a luxury product because the price points are so high, not because people don't understand the value proposition or don't want to buy a product that's

[00:32:31] perfectly priced for them. So that's been our finding. I mean, a big part of I think our success in distributing insurance to people and getting the kind of conversion rates that we get is the fact that we partner with great brands to sell through them to their customers.

[00:32:49] If we were just cold calling people on the street, hi, this is Ted from Toronto, do you want to buy some insurance? I don't think we're going to get much more than one or 2% of people saying yes, even if the product is good, people just don't know who

[00:32:59] we are. They don't intrinsically trust us, right? We're not really a startup anymore, but we're still a young business versus if I call someone from Airtel Money and say, hi, this is Ted from Toronto calling a partnership with Airtel Money,

[00:33:14] and we've got this great insurance product, do you want to buy it? Airtel's given their stamp of approval. That's a much more compelling proposition to someone because they trust in that brand. So that's been true with Mcopa and Airtel and many other brands

[00:33:27] that we've sold through. Those brands are trusted enough that people are like, oh, if this brand is saying that this is a good insurance product, then we should really pay more attention. So we've discussed that insurance can be seen as a luxury or aspirational product.

[00:33:42] You have a presence in Kenya, Uganda and Nigeria. Are there any key differences or similarities you've observed in how insurance is viewed across those markets? Yeah, great question. We're actually in Ghana now too. We've acquired a business there. So

[00:33:59] that's an exciting move for us. We have an amazing team that we get to work with there now and some great partnerships already established through that acquisition. There's definitely differences in these products across different markets. You look at Kenya and

[00:34:16] Uganda, people are much more willing to buy a funeral insurance product than in Nigeria, for instance. Just culturally, there's, for some reason, Nigerians have it in their mind that they should be, that there's bad luck. Yes, yes. You need to trust God with your life better than

[00:34:35] buying an insurance. That's not universally true in any way, shape or form, but just in terms of conversion rates of people buying, we've definitely seen that and that's been a key driver for Y

[00:34:45] in a lot of our surveying. In Kenya, people trust God but prepare. So it's just a little bit of a different nuance to it. I think in Nigeria though, the medical insurance market is actually even more

[00:35:02] developed. The private medical insurance market is even more developed than per se in rural Kenya where there's not really many HMO products available. There's some really great variety of HMO products available in Nigeria. So we go into these different markets and we

[00:35:20] design what's appropriate for that market and work with the local context, and then we try and share learnings about what we're doing in these different markets across our business to have the best opportunities available for the most people in different contexts.

[00:35:34] That's great to hear. So you mentioned that you've recently launched in Ghana. Do you have plans to expand into any additional markets in the near future? Many plans and aspirations. Nothing that I'm quite ready to talk about yet, but watch this space.

[00:35:52] We're definitely coming to a country near you. It's a very difficult market right now. The market for capital is bad. The market for many countries in terms of inflation and currency devaluation

[00:36:06] is really bad. But at the same time, there's a lot of opportunity when things are a little bit bad to come in and get a presence established. So by God's grace, we're very well capitalized and

[00:36:17] we have the opportunity to expand it to different markets like the ones that we've already expanded to. And yeah, I think we hope to do more growth into different markets in the in the not too distant future. All of that said, we have a huge business potential and

[00:36:33] opportunity for growth just in the markets where we're already launched. So most of our focus is going to be where we already are, though we are going to expand in some other places as well.

[00:36:44] So as part of your expansion or entrance into Ghana, you acquired micro-insure. So how do you feel this acquisition contributes to Turaco's overall strategy and process? We were 100% planning to expand into Ghana at some point over the next few years.

[00:37:04] The opportunity to acquire micro-insurers, Ghana business and work with that amazing team that they already had in place and the partnerships they already had in place was so good that it accelerated our timeline. So that's the only change is it just made us go there faster.

[00:37:21] Ghana is a fascinating market. It's actually the most insured per capital market. Sorry, fascinating for insurance. I think insurance is sexy. So I'm a little special in that way. But fascinating market for insurance. It's probably the most insured per capita market

[00:37:38] on the continent and really because some of the initial innovation from those companies that I described, micro-insurance, FEMA came in Ghana and they managed to figure out how to distribute insurance through telecommunications companies that was incredibly effective. So people really

[00:37:54] understand insurance in Ghana in a way that most other markets on the continent just don't. So that creates a more competitive market but also a more interesting market in many ways because

[00:38:07] you don't have to explain quite as much and you just need to make sure that you're competing well on product and value to customers. So we're actually learning a lot from that business and it's changing some of the way that we're designing products and other markets.

[00:38:21] So yeah, really excited to have that opportunity. Fantastic. So is the acquisition route like a trend or a route that you'll be going down in the future when trying to expand into new African markets?

[00:38:34] It's I think always wise to explore it. Starting Greenfield going from not even an existing entity to first customers and team is very expensive and very long process. And we found in Ghana that we got probably two years worth of value in terms of expediting our expansion.

[00:38:54] Even if we were to start today, it would probably take us two years to get to where that business is today just as Toronto on our own. So I think there's a lot of value in exploring

[00:39:02] acquisitions that said, there's got to be the right company and the right opportunity and the right team to be able to integrate into our business. And I've heard so many horror stories of acquisitions from close friends and from mentors over the years that I was very hesitant

[00:39:18] actually when the opportunity came in front of us. But I think it's been incredibly seamless compared to what many people have told me of their acquisitions. So I think it just speaks

[00:39:30] to the quality of our team and the quality of the team that we were able to acquire, that we were able to integrate those two businesses so well. And yeah, now we're looking to grow, which is a really fun place to be.

[00:39:39] Brilliant. That's great to hear. So if we step outside the Ghanaian insurance base and look at Africa as a whole, are there any trends in Africa's insurance space that you're seeing currently that you're excited about? I think the thing I'm most excited about is the,

[00:40:00] you're going to laugh at this, is regulation. Sexy regulation. Yeah, I'm really making myself sound like a forward guy. There's been a, and this I have to give props to the people

[00:40:16] that have gone before us, that when there was no regulation on how to do micro insurance and it was, there wasn't even a concept to work with. It was very hard for these companies to first get started.

[00:40:27] So we're being a second mover in this space able to come in and ride on the work and coattails of these predecessor companies who did that work for us. But what that means is we're in the

[00:40:38] middle of a big regulatory shift for micro insurance, for mass market insurance. And there's micro insurance regulations for an underwriting company in Kenya and Uganda and Nigeria that have much lower paid up capital requirements and more appropriate for mass market guidelines

[00:40:58] that are making it possible for us to build what I described, right? A profitable business for mass market. So I think there's probably another 10 markets that have draft regulations in place that I'm just salivating, waiting for those countries to pass those regulations and then

[00:41:17] we'll be able to go there and have a much more compelling business model for doing what we're trying to do. So yeah, I think regulation is the other place that I think is very sexy at the

[00:41:26] moment. That's strangest that sounds. No, no, I agree 100% so if we move from current trends and look to the future, now this is a very open in general question. But where do you see African five years time from the perspective of access to insurance for the general population?

[00:41:48] My hope is we have like Toronto on our own will create access to insurance for more than 100 million people in the next five years on the continent. And I have got very clear eyes on

[00:42:01] probably half of that already. So just need to develop a little bit more than half more than what we've done now and we'll get there. I think outside of Toronto, as we've proven this model,

[00:42:11] there's actually more and more companies that are really looking at us and saying, wow, this is a real business. Let's learn from them and try and replicate. So I think right now vast majority of Africans do not have access to affordable insurance products, right? We're

[00:42:26] talking 85 90% of people don't have access, much less have insurance, don't even have access to it. And I think that that number will be possibly half that in five years. Definitely, definitely within 10 years. Thank you for sharing that. So if we look closer to home, where do you see

[00:42:43] yourself in Toronto in five years time? What impact will you have on Africa's insurance space or what impact do you hope to make on the space? I think we'll be well on our way to being the largest insurance company on the comment,

[00:42:58] if not already there. So certainly in terms of number of people insured and hopefully on our way in terms of total premium. I hope to create and we hope to create with Toronto a whole new class of profitable insurance that is the envy of every insurance company

[00:43:20] that wants to operate in our markets and looking beyond Africa, looking to other places to operate as well. But that's the goal. That's what we're building towards us. The team that we've hired was the most amazing team I've ever gotten to work with, the technology that we've

[00:43:35] built, which is seamless and highly effective. And yeah, really the vision and passion that we have for serving mass market consumers. So from an impact standpoint, every single product we sell helps people, whether that's through actually paying claims or peace of mind and ability to

[00:43:53] unlock and be a little bit riskier in the way that people live their lives by pursuing more investment opportunities. So I think from a social impact standpoint, every customer we have will

[00:44:05] be impacted and yeah, it just thrills me to be able to build something like that. I think it's more of a calling than it is a business opportunity at this point. As people, we often have quote mantras, proverbs or affirmations that keep us going when times

[00:44:21] are challenging or when times are good. Do you have one that you can share with us today? I have many that drive me. I think the one that has been the most impactful over the last

[00:44:34] year or so is from a poet, David Wyatt. And he was quoting a monastic friend of his, but he wrote that the solution or the antidote to exhaustion is not necessarily rest. The antidote to exhaustion is wholeheartedness. And I see so many people walking around exhausted

[00:44:55] by their lives and not able to put their full passion and their full life behind their work definitely in this startup ecosystem. And I've just tried to lean into not necessarily, it's been a very tiring few years. We've gone through multiple investment rounds,

[00:45:15] all of which almost failed before they succeeded. And there has been a lot of exhaustion in my life. So it's been interesting how rest has not been the solution. It's really being wholeheartedly

[00:45:28] focused on the mission or trying to build and on my faith and on the things that are important to me that's led me to, yeah, having the fullest life that I have it within me to live, which I think is what God wants for us in this life.

[00:45:45] Thank you for that, Ted. It's one that I've not heard before, but it's a fantastic quote. So thank you for sharing it. As we come to the close of today's conversation, I was wondering if you have any closing remarks or final calls to action for people

[00:45:58] who are interested in Africa's insurance space or interested in the work that you're doing at Truaco. Well, I'll just leave with this word for all of my founder friends and those in the startup community that are struggling with a difficult funding environment and a difficult

[00:46:17] operating environment because the economy is being so bad. Stick with it guys, the opportunities are still there and I've been really encouraged by some of the quality of businesses that we've seen and that we've been able to work with as partners at Truaco. And I think that the

[00:46:34] capital will flow again. So stay in the course, is my word there. The two investors and those that are engaging with this podcast trying to learn more about the continent. This is the last frontier, right? This is the last place where you can come and start a pizza

[00:46:49] hut and it's an interesting business. So take a look, I think the risks are real but I think there's real value to be made and I think that for those that have made a lot of money,

[00:47:01] if you're looking to have something more meaningful in your life than just adding another zero, try and add another zero over here because you'll do a lot of good in the process

[00:47:13] if you have the right mentality. So I'll leave it there. I mean, I'm very happy to talk to people about Truaco. If you're interested in joining us, please reach out to me on LinkedIn.

[00:47:22] We've built an amazing team and amazing company and an amazing group of investors and definitely excited about what the next few years looks like. Fantastic, Ted. Thank you for sharing the transformative journey of Truaco in reshaping the landscape of insurance in Africa.

[00:47:40] And as you continue to make impact on the continent, I'll be looking forward to seeing how you impact communities and what we've discussed today in terms of making insurance widely available to the mass market. It's been a great conversation and a pleasure having you on

[00:47:57] the podcast. Thanks, Tercer. I loved it and yeah, blessings to all. Bye. Thank you to everyone who has listened and stayed tuned to the podcast. If you've enjoyed this episode, please subscribe,

[00:48:11] share or tell a friend about it. You can also rate reviewers in Apple Podcasts or wherever you download your podcast. Thank you and see you next week for the Unlocking Africa podcast.