During this episode, Ty Harris sits down with our hosts to share the story behind his startup, Openly, and why, with his first kid on the way and after 12 years of success at Liberty Mutual, he decided to embark on this new adventure.
Heads up: Throughout this episode you may hear Rob refer to the podcast as undercovered, instead of uncovered. Rob did not have his coffee on this day and we apologize for any confusion, but we hope you enjoy this blooper. :)
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List of resources mentioned and suggested reading in episode:
Before founding Openly in 2017, Ty spent 12 years at Liberty Mutual, a top 5 global insurer, where he was most recently EVP and Chief Product Officer. In this role, Ty led an organization responsible for product, pricing, underwriting, and innovation across all personal lines of business. Prior to Liberty Mutual, Ty did research at the Brookings Institution and taught economics and statistics at MIT and Northeastern. A Duke and MIT alum, Ty is also a fully credentialed actuary (FCAS). Ty lives in Boston’s Back Bay with his wife and two kids. He’s an enthusiastic runner, snowboarder, windsurfer, and dad!
Openly is proud to offer innovative, comprehensive homeowners insurance, wrapped in modern convenience. We arm agents with the tools necessary to serve up a world class customer experience.
Welcome to the uncovered podcast where we take a deeper look and to be ideas of companies and entrepreneurs that are creating the future and uncover the stories you haven't heard. Uncovered is presented by PJC and early stage venture capital firm committed to supporting the next generation of entrepreneurs.Speaker 2:
We're back with another episode of the uncovered podcast. I'm here with my cohost Rob may and David Martorano and we have Ty Harris on the show today who is the CEO of openly. How are you doing today? Tai , I'm great. Thanks so much for having me today. Yeah, absolutely. Thanks for coming in. Um, what we'd love to do is dive into your background. Uh , you're at Liberty mutual for some time and you know, what was the, you know, give us a background on openly and , and why you started it and kind of what you're up to. Yeah, no, thanks. So, yeah, you're right. I came up to Boston years ago to go to grad school at MIT. Um, I went from there to Liberty mutual, which of course is a huge insurance company based here. You know, when I went in, I was a beginning actuary and that was kind of the, the way in the door for quantitative people. So that's how I got my start. I spent about 12 years at Liberty doing at first really quantitative things, building, you know, models and pricing things. Uh, by the end of my time there was a, I was a very senior executive, so I was a chief product and underwriting officer for their personal lines of business globally. And you know, that was an amazing job. And a couple of years ago , uh, roughly the same month that my wife and I had our first child is as luck would have it, I actually decided to take the jump and , uh , start openly and I wasn't, you know, wasn't running away. Liberty is a great company. I wasn't running away from anything but founding openly. Um , the best second say from, you know, about my personal motivation. I just, I really, really enjoyed the days when I was , was building new things in my job. And I, I less enjoyed the days when I was defending old things. And I, and I wanted to do a job where it was more like a hundred percent building new things.Speaker 3:
Ty , how much was the decision to do openly driven by the desire to start a company. And so you knew insurance and went into that and how much of it was in your day job you just saw like, wow, here's this need that isn't being met.Speaker 2:
Yeah, I mean, I'm sure the right answer is that of course I saw this need that wasn't being met. The truth is I saw about 20 needs that weren't being met as I'm sure most people in a big, you know, a historical industry probably see. And not everyone takes the leap. So I , I think most things that happen in people's lives are ultimately come down to something, you know , personal or something , uh, you know, driven by their, what they want out of their lives. And so for me, it really was that motivation to , to start and to spend my time building things. And I, I saw, literally made a list of about 10 big problems and insurance and I said, I could go after any one of these and I feel like it could be a business and openly is the one that , that Rose to the top for a number of reasons. Uh , but there was, it was more so that desire to , to start somethingSpeaker 3:
great. We came up with the name of openly.Speaker 2:
Yeah. So , um, you know, days of course. Um, if you look up openly, if you Google openly, well first you'll see our company, which is great. Right below that you'll see the definition of openly, which is , um , essentially , uh, you know, without deception or prefabrication, especially where those things are, are , uh, expected. And insurance is a place where there's a lot of positive intentions. But I do think some people expect deception and insurance for, you know, some deserved and some undeserved reasons and openly really is trying in many ways. And I think proving to be the opposite. So everything about our company, we put our , our policy contracts that customers see right out there in our public webpage. You know, very few other carriers do that. We , um, you know, the, we , we work explicitly through and I'll , you know , can talk more about what we do. We work explicitly through independent insurance agents who are openly comparing prices and products for their customers instead of like cramming one carrier's product down their throat. So it really is in the spirit of our, of our company. There is a nature of it. You know, when you get kind of nerdy about it, there's uh , an aspect of openly which is that we see ourselves ultimately really as a platform that is connecting consumers who need insurance with , uh, providers of capital for insurance with reinsurers and insurance companies in the backend . And we do so through what we consider a pretty open platform. Um , but that's more of the kind of technical thinking there. So we call this the undercover podcast because we always want to focus on things that are under-covered . And I find it really interesting cause there aren't a lot of insurance startups and I think many of our listeners who have been entrepreneurs or investors, they know how to look at like software startups or sort of direct to consumer products , startups. It's like you either make a thing and then sell it or you write some software and then sell it. Like what do you have to do to start an insurance company? Like there's a bunch of laws [inaudible] and shit like that. Right? Oh, it is . Tell me about it. It , I mean, as, as, as you all know that one of the most dangerous things about starting a company is if you can't learn quickly, if you don't get feedback that Hey, you're on the right or wrong path. And that's the hardest thing about an insurance company is there are all kinds of regulations , um, and other barriers to entry that preclude you from getting immediate customer feedback. We were literally launched in market this past October of 2019 and that was two years after we founded the company. Uh, we'd raised a bunch of money by then. Um, we had , um, you know, we had to line up re-insurance, we had to line up what's known in the industry affectionately as a fronting company, which is basically, it sounds below board, but it's perfectly a bumbler , but it's basically , um, like a company of record on whose behalf you're technically writing the insurance. And then we had to build the entire operational stack of an insurance company. You can't build an insurance company that's just an MVP and as like the pricing you need also, you know, claims and service and billing and the whole, so it was a huge build. Um , there are both regulatory but also just capital obstacles and um, uh, technological, you know, kind of , uh , obstacles to doing it as well. But we're , we're amazingly proud of that. And I'll just say that we, we built much of this from whole cloth and it was amazing. We had real, you know, we went through Techstars and every day we'd show up in our classmates would have their KPIs from latest week and we'd show up with, ah , still trying to get that reinsurance company to work with us. And that wasn't fun, but it's amazing to be there now. So on that topic, why don't you talk a little bit about, you know, your decision to go to Techstars and versus other incubators. And the second part of that question is maybe talk a little bit about T to Rob's point about uncovered something that you didn't expect or experienced part of Techstars you didn't expect or something you can get insights as other entrepreneurs thinking about going to a Techstars and things like that. Yeah, I mean tech stars is obviously a bunch of different incubators out there with different styles. Tech stars was amazing for us. What if you're not familiar with tech stars , takes what I would call a very personalized, a small boutique approach as opposed to you know, bringing in like a thousand companies and then not knowing them. Well Techstars , you know , brings in about 10 companies we went to through the Boston program. Uh , there were 10 companies in our class and it's extremely intensive for that reason. It's a three month program. And you know, the , the managing director of the program that we went through, still, we meet with them all the time and he's a , he's one of our greatest advisors , um, you know, way beyond any financial contribution and , and even beyond the sort of name stuff that you get through, you know, meeting investors, the, the advice that we got through Techstars was just amazing. The thing that's, I guess, surprising , uh, was one of the things that surprised me was just the sacrifices that are, the other companies in the program are going through. I mean, there were, there were companies where people had families and small children and the CEO's off to, you know , China for six weeks to, to, you know, more with the manufacturer there or, you know, all kinds of stories like that. It was just inspiring in a way and humbling in a way to see what these other founders were putting into their companies. So, so is this the first company that you've started throughout your entire career? It is. Um, you know, I've had, I'm a man of many hobbies, so, you know, even when I was in a big corporate life, I had some , you know, but I , this is certainly the first like real company that I've started and it's , um, it's quite a transition. I, it's, it's definitely the right move for me, but I would want to have a long, hard talk with anybody else who's thinking about making the transition from a big, high level corporate job for sure. So talk to, talk to us about that transition. So as you, as you jumped out of Liberty mutual to start openly, you know, what are some of the things that you know, that you took with you and how do you think about, you know, spinning out of a large company to start a startup and, you know, how do you feel like your network has helped you as you've built openly? Um, you've obviously, you know, you , you kind of Rose through the ranks at Liberty and you probably left with a really strong network, I'm sure. And so how have you leveraged that? And what are some things that, you know, you could , uh, you could shed some light onto our listeners? Yeah, well, I , my main thought would be, if it's been this hard for me, then I can't even imagine how hard it is when you're, when you don't have that kind of network to begin. You know, the , the, the pros certainly , um, are that, you know, compared with, you know, people coming straight out of college, you, you have thought about building a talented team before and you've thought about how to build an organization, how to give people ownership of things, and you've thought about measuring things. You've been held accountable, you know , um, and then of course, the relationship . So an insurance, this is all about knowing reinsurers and knowing the credit company, you know, the credit companies that provide the credit scores and knowing all the vendors and knowing, you know, the , just the baseline intuition of, Oh, if we're selling this many policies, that probably means we're under priced. And, you know, so that stuff helps amazingly , um, and the credibility. But the flip side, it is , uh , amazingly humbling. Um, for me, I enjoy being humbled. I, I've, you know, when I was in grad school, I became a competitive ballroom dancer. I practiced 15 hours a week. Now. I was never gonna be like a world champion ballroom dancer. But it was fun for me cause I like building from nothing. That alone is worth it . I mean that is talking about uncovering founders in Boston. I mean that's a great stat . Whole podcast are 25 minutes or more than, I mean, that was amazing. I'm going to just start my church out here. I know , but you know, it , I was at MIT and it's , you know, MIT is good at the kind of niche sports, right? Like pistol shooting and ballroom [inaudible] but anyway, it point being that like , um , I think I enjoy that kind of tearing something down to the ground and really starting from scratch and , and making myself excellent edit. But , uh, that is what you, you have to do. You're used to, you know, the, the perks, the salary, the , um, internal respects , the, the availability of resources that comes from a big company. And suddenly you're out there pitching to people who mostly don't necessarily listen to you, who don't, you know , uh, you know, recognize whatever you thought you might deserve as recognition, this space, it doesn't really matter to them, which is fair. You know? And, and finally, you're , you're held accountable to absolute results. It's not like, Oh, you made a good PowerPoint. We think you're doing pretty well. I mean, I'm not, but just in any big company is gonna fall, pray a little bit to that. Whereas the market just, it may lie, but like you , you are accountable to whatever it's saying directly as opposed to what you see . It's not the inputs you put into it. It's, it , I mean, that matters, but it's ultimately the outputs that you get out in the market that matter.Speaker 3:
Yeah. So you mentioned the respect you get at a big company. Um, I think a lot of people want to come into entrepreneurship because they feel like, Oh, entrepreneurs are so well respected. But you know, the truth is you're , you're not until you're successful really. Right. Um, and I'm curious what that transition was like for you and how you , um, if, if being an entrepreneur and being a CEO was what you expected or where was it?Speaker 2:
Yeah, the , um, I mean, this, this is, this will sound cliched , so iPod , but , but it's just, nothing could be truer than that. The, I, you know, I came into this thinking, Oh, everyone says that like persistence and you know, banging your head against the wall 300 times. So the 301st time and it's like a door or something and you hear that, but you don't understand how true that is until you do it. Right. I mean, [inaudible] you know, a month after I left this great corporate job at this business plan and went up to some, you know , conference on InsureTech and started pitching to people and they just, we didn't have our, you know, everything together as well as we should have. But the, the , um, the need to talk to a hundred people for everyone who's going to be interested in the early days is just, it would've been so easy. So many times in our company, we've had a relatively easy path as a company. I mean , we got into Techstars and we had great investors there, but still there were , there's probably a hundred times when we could have easily quit. Um , and you just, you can't express it to someone until they've done it, I'd say. Um, so on the topic of, of Boston , um, talk a little bit about building in Boston and what do you think Boston super power is? Yeah, it's, well, it's, it's been amazing for us building in Boston. I think the , um, well , very selfishly , uh, there , there's actually a great insurance ecosystem in Boston. Um, besides obviously the amazing tech ecosystem. Um, we have heavily leveraged insurance ecosystem. You don't think about it, but you know, there's a number of really great insurance companies around here and we actually working with them either via , um, you know, sometimes their employees who have chosen to join us , um , sometimes as partners , um, you know, where they're backing us in in some way or investing in us or whatnot. Um, so, you know, I don't, I wouldn't consider that a universal super power , but it's a really neat place to build a , an insurance company. It's also , um, you know, the, Oh , I , I'll be careful how I [inaudible] I've really had wonderful conversations and relationships with investors here. Um , especially in this sort of FinTech space. It feels like, I don't know if I was, I would have to think about it if I was building something, which I'll , I'll call and there was a little more purely a new market consumer, I don't know. But like, certainly, and for what we're doing , um, you know, having Boston and the proximity to New York and everything's just an amazing place to be building stuff. SoSpeaker 3:
you have a different kind of startup, like we mentioned before, being an insurance rather than say software or a direct to consumer product. What's that? What's been the impact on hiring? Is it harder to hire, do you think? Or , um, you know, are you hiring a lot of people out of the insurance industry? Are they afraid to leave big companies? Like what's that like as a, as an entrepreneur?Speaker 2:
Yeah. So we are, we're really half and half. We've to be good at insure tech, you have to actually have a lot of really good insurance people and some really good technology people. And we brought in on the technology side folks who , um, except for one had zero experience in insurance. And that's a very good decision. Not that there's not good insurance people, but what we found is that there's an amazing , um, group of technologists out there who are interested in going after a huge industry like insurance. They , they're not really quite sure how to, when you talk to them and say, Hey, here's what we're building and here's why home insurance today is not amazing. You can relate to that, right? And here's what we're doing. We're making it so that with three questions, you can get a binal rate on $1 million house. Wow, that sounds challenging. There's machine learning in and there's, you know, production , uh, connections to a million different providers of data. And there's, Oh, by this way, there's this whole policy administration system. There's a beautiful user interface that agents have to use. So , um, and by the way, we're building an NGO and not in, you know , some language from 3000 years ago. So , um, that is, we've had amazing luck there. Now we are a partially remote team. We've sort of built a, some presence in Boston, some in Ann Arbor and then some truly remote. So we have worked open to different ways for people to work.Speaker 3:
So is , so does that happen to a lot in terms of recruiting, in terms of other markets to have people work remotely and with the generation today of the millennials, a lot of people are working remotely. It's become a, a power outlet for a lot of companies. And we have a lot of portfolio companies. At PJC that, that, you know, have remote workers because it's been a tough market to hire in general. Is there any specific reasons why you speak to those markets specifically?Speaker 2:
Uh, you know, we started out , um, I , I would love to say there was a grand design. We actually started out by chance just saying, look, to get the kind of talent that we want. We're gonna make a choice. We want the best talent and we're going to be willing to hire that , um , sorta wherever it may lay. Now by chance, a couple of our , uh, really strong early employees, we're based in Ann Arbor, Michigan, and we said, Hey, actually they have some interest and not, you know , necessarily working from home. They'd rather work from an office in Ann Arbor. We said, Hey, let's try that. And that's worked out really well. Um, so they , they do kind of the partial, some days are fully remote. Some days they come into an office and can collaborate. And that's worked very well. Um, but it wasn't, it wasn't that we had a , uh , consulting firm do a two year study on locations. It was , we kind of chanced into that.Speaker 3:
Very cool. Um, and how many people are openly now and how has the job of startup CEO changed as the size of the companies changed?Speaker 2:
Yeah. Or 16 people. Um, well, in the early days when it was two of us, it was mostly , uh , uh , you know, obviously I was literally building things . So Matt was building the , uh , production technology and I was building sort of the insurance side, the policies and the rating models and we were both spending a lot of our time knocking on doors of, you know, investors or , uh, insurers, reinsures et cetera . Um, yeah , there's the obvious transition to , um, you know, needing to empower people. I think one of the toughest things compared with a big established company is figuring out the right moment with each function or each task or however you want to think about it, to , um, really empower somebody and, and which, and which places you feel like, well, this still needs like, you know, my vision as the founder and it , you know, in a big company, you're so infrequently building an entirely new direction. To the company or entirely new wing on the company. That doesn't come up as often. It's mostly, Oh, I've got great people, let's just empower them to do these things. But there are those moments in startup life when you as a founder do need to be involved in kind of more hands on setting the direction. That's been the hardest transition coming from a, I used to manage 800 people, you know, my, at Liberty and uh , so managing 16 still feel small. It's like, wow, I really got to , you know, nose into some of these things or , you know, I still gotta roll up my sleeves.Speaker 3:
Yeah. So , um, so we call this the, an under-covered podcast and we like to ask everybody, what's your undercover idea that people have not , uh, you know, maybe something that you didn't expect or that you wish somebody had told you , um, or , or that you would give as a piece of advice to founders of like, Hey, if you're gonna go start a company, here's the thing. People don't tell you that it's like, that. You need to understand what's, what's your sort of secret piece of advice?Speaker 2:
Uh, this'll be, I don't know if this is universally applicable, but you know, for me personally, I, I mentioned when I left my big corporate job was like the same month that we had our first kid. We've had , uh , my wife and I have had a second child and building a , she actually runs a startup as well, her own startup. I run my startup with two kids. So that combined with the fact that things just maybe again, maybe it's our example, but things just take longer than you think. So you always think, Oh, six months from now this will either gone into the ground or it'll be like, you know, Facebook, if that's just not , it doesn't seem like that's the case. It's like six months from now we're going along and we got some many bites. But, and I think if you treat it as, you know, on the one hand time is, you know , being fast as your only real advantage as a startup. And that's true, but you can't make that have you live your life as if the next two weeks are the only two weeks I have left in my life because you'll ignore all the personal relationships in your life. And then before you know it, you'll wake up in two years, has gone by and you know you. So you really do have to pace yourself in some macro sense , um , when it comes to relationships outside of your business.Speaker 3:
Cool. Well thanks for coming on the show today, Tai and um, I hope those of you listening will check out , uh, all the other podcasts for season one. And , um, if you're building a very innovative tech company, we'd love for you to give us a call, a PJC. We'd love to take a look. Uh, if there's guests you would like us to have on the program or questions you would like us to ask future guests, please send those to podcast at PJC dot DC . Thanks for listening.Speaker 1:
Thanks for listening to the uncovered podcast. To learn more about PJC and the uncovered podcast , visit us at www.pjc.vcoremailusatpodcastatpjc.vc .