During the the Vivatech conference that took place in Paris from june 30th to July 2nd and gathered 5000 startups, investors, 500 speakers and 45 000 attendees I spent some time on the AXA booth, one of the more voluntarist french companies regarding to digital transformation and had the opportunity to meet some of the people making this transformation happen.
Partnerships with startups are key for very large businesses like AXA. However, seen from the outside, it’s not always easy to understand why such synergies are being built, how to manage them and how to make mutual benefits from it, avoiding the large business to become a burden for the small one. That’s the purpose of my discussion with Elise Bert Leduc, Brand & Partnership Director at AXA France .
Bertrand Duperrin : Hi Elise. How did you become Partnership Director at AXA France ?
Elise Bert Leduc : I used to be sales manager at Google for the insurance sector. I had the chance to work with AXA, we built strong ties, I really appreciated their approach and saw they were really giving themselves the means to succeed. When they offered me to join them I accepted at once.
BD : Why is it so important for a large business like AXA to get closer to startups ?
EBL : There are two reasons.
First there’s a need to be truly open to the outside. We’re living in a world where nothing is certain and predictable anymore. We must be open, connected with the outside. We need sensors to understand a changing world.
Then there’s the customer. 20 years ago he used to come to us at 18 to purchase their first auto insurance. Then his first housing and so on. He used to be a lifetime customer. Today the young get their driving licence later – or sometimes are not interested in – don’t buy a housing and prefer flatsharing, what is the most valuable for them is their smartphone. We need to understand these new behaviors.
Working with startups like Blablacar helps us to understand these behaviors.
Yesterday we used to insure ownership, today we’re insuring usages
We used to insure the ownership of something, today we’re insuring the usage. Each and every day we’re challenging our actuaries to find how to insure these new risks.
Last, since I’m also in charge of brand management, these partnerships also feed our brand. For example our logo appears on the homepage of Ouicar.
BD : We often hear that working with a large company is a real risk for a startup. How to make such partnerships work not that the startup loses its agility and DNA.
EBL :One must stop pitting the new economy against the old one, startups against large businesses.
Startups are often made of a core team of 10 people or less. We’re larger, with a structure but also with lots of skills, know-hows. For a startup we’re a kind of swiss army knife with a structure able to accompany them in their international expansion.
We’re also their insurer and that’s very important for young businesses. They come to us for all these reasons.
For a large business, partnering with startup must not be a matter of exploitation
I’m very proud of what the startups we partner with are saying about the partnership and the trusted relationship we managed to build. There’s no successful partnership without trust.
BD :Many large businesses have a very unclear strategy regarding to startups. It’s hard to see the guiding principe, the goals. At some point it even seem that it’s only opportunistic, a matter of communication.
EBL : That’s obvious that large companies must not use startups for communication exploitation only. We must build a win-win relationship, not use the other for our own and only needs.
On our side, we bring our expertise, technicality, means to them. They can use ouf offices for meeting abroad, we do co-communication and co-marketing. For example we gave one of our startups access to our SMB clients because the service it provides is very relevant for them.
On their side they help us to be more agile.
BD : Wer’e talking of partnerships, mutual benefits. For AXA does it mean that you may invest in these startups.
EBL : As a matter of fact we’re investing in startups but it has nothing to do with partnerships. We have a dedicated fund, Axa strategic ventures, that manages these operations but it’s a separate business. Partnerships are one things, funding another, sometimes a startup can have both but there’s no cause to relationship link.
Partnering does not mean funding
Our core business is protection and we’re helping them in this field. We insure the founders, the company, the usages. Founders and the leadership team has too many things to deal with, they hold multiple roles and can overlook critical matters because of lack of time.
A very relevant example. Most startupers use scooters and experience shows that when a key person in a startup has an accident it may put the whole business at risk. We’re covering this risk.
BD : Are there possibilties that you eventually buy one of the startups ?
EBL : That’s not our purpose. Maybe one day if a startups is closely related to our core business but that’s not the intent of the program.
More, if we buy a startup there’s a risk that it will lose its ability to innovate which is precisely the reason why we partner with it.
Buying a startup may be a bad thing for both the startup and the large business
So instead of buying startups at the risk of losing their DNA we’re trying to start our own ones. We have a program called KAMET dedicated to that. We have talents, assets, capabilities, experts..we’re trying to bring them together to develop insurance focused startups.
BD :Today some startups are in a grey zone regarding to law. They’re exploring new models and usages and their business model takes legal actions into account. Fines are part of the model, just like marketing or R&D. As an insurer, do you cover this risk for the startups you’re partering with ?
EBL : No. The startups we’re partnering with are 100% legal and we’re not playing in the grey zone.
The risk we’re taking is to insure new usages for which there’s no history. We have a team of “special” actuaries dedicated to these new usages, we ask them to find ways to insure thinks no one has insured before. Then we’re closely working with the startup to technically manage the risk.
BD : Thank you Elise.