Posted In:

Payments


FinTech Collective Invests in Diesta

Published:

Oct 15, 2024


Authors:

Toby Triebel

Samantha Wulfson

Posted In:

Payments

Published:

Oct 15, 2024


Authors:

Toby Triebel

Samantha Wulfson


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We are excited to announce FinTech Collective’s lead investment in Diesta’s $3.8m Seed raise. The London-based software solution for the insurance industry is focused on streamlining premium payment reconciliation for brokers and MGAs, bringing a long awaited revitalization to a massive, global industry that is stuck in the 90’s. The new capital will be used to scale Diesta’s product suite and geographic footprint.

Company Description


Diesta was founded by Julian Schömig (CEO) and Chris Davis (CTO) in 2022 with the vision to eliminate premium processing time and costs and become the central settlement system for insurers and brokers worldwide. Julian’s determination to address real-time premium payments processing, reconciliation, and treasury management stemmed from his time working throughout three countries with Munich Re, focused on aviation reinsurance, actuarial science, and data analytics. This depth and breadth of experience only further illuminated the industry’s pain points.

In the UK, 35% of premium payments pass through three different intermediate accounts before reaching insurers, with brokers often struggling with millions in unallocated and disputed premiums. This process causes delays and data losses, with market participants absorbing the cost in their expense ratios and ultimately passing it on to clients. The lack of visibility on the live cash status results in excessive manual reconciliation costs of more than £2.5m per broker, with unallocated funds exceeding £50m over periods of just 7 days. What Julian experienced planted the seed that became Diesta.

In the time that has followed, Chris’s technical expertise propelled Diesta to develop a fully digitised, AI-enabled solution. For the first time clients can achieve full control of their treasury management, monetizing payment flows through multiple channels. The vision and execution of the co-founders has been both complementary and successful in lightening the industry’s heavy operational load and improving the accuracy of otherwise manual, daily excel calculations with auto reconciliation - in turn enhancing employee productivity and refocusing time on higher value activities.

FTC Summary


We met the team at the very beginning of the year, and have spent the past months getting to know co-founders Julian and Chris while witnessing their quick path moving up the customer value chain to capture clients with global operations and more than $1b in revenue.

Our thesis surrounding the opportunity for SaaS solutions to modernize insurance infrastructure is long standing, as the industry has been late to the game in reaping the benefits of innovation that have propelled other financial institutions forward. Isolated legacy systems, manual processes, and fragmented distribution channels still persist but are ripe for disruption.

Premium payments in particular have stood out to us. Although digitisation is slowly making policyholder payments easier, this process does not extend throughout the insurance value chain to premium payments. Trillions of premiums are written per year, with 7x the volume being processed in payments given the convoluted flows of funds. This translates to an enormous operational and financial burden, with the cost of premium processing reaching $32b annually.

Diesta’s end-to-end premium reconciliation engine can not only cut these costs by 75%, but we believe can entirely redefine the industry’s status quo. We look forward to partnering with Diesta on this journey.

“We’re thrilled to be partnering with FinTech Collective on our mission to transform B2B insurance payments. After meeting the team in London and New York, we’ve seen firsthand their operator mindset and bold vision-setting, which align perfectly with our ambitions for the future.”

Julian Schömig and Chris Davis, Diesta Co-Founders

Select Media Highlights


EU-Startups: London-based Diesta gets €3.5 million to transform the way insurance companies process B2B premium payments

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