In this week’s interview, we’re bringing you Ryan Letzeiser from the landlord-focused insuretech, Obie. Fresh off a $25 million Series B raise, Obie is working to change the way insurance is bought and sold by offering instantly bindable quotes through an embedded distribution strategy.

Without further ado, here’s a short Q&A we conducted via email:

What has Obie’s fundraising journey looked like, in terms of rounds, and how much you’ve raised?

Obie has raised three institutional rounds of funding. We started with our seed round coming out of the accelerator, Y Combinator, in 2019. Next, we secured our Series A in late 2020, and just this past month secured our Series B for a combined total of $40 million raised.

What were some of the challenges you came up against raising a Series B, that differ from your Series A, two years ago?

Typically, a Series A funding round indicates proof of concept for a company, signifying that the business idea is truly feasible. Series B rounds are usually more indicative of product market fit, meaning there is proof that the product is satisfying a demand in the market and there’s an opportunity to pour more fuel on the fire.

As we looked to secure our Series B, we focused on metrics like customer lifetime value and acquisition cost as well as net present value, instead of the projections we had leaned into when securing our Series A. We also looked to continue differentiating our tech strategy when pitching investors for our Series B, underlining the unique value of investing in Obie.

What were some of the adjustments you made to raising this time around, given the current venture capital environment?

The current VC environment requires companies to show proof of solid fundamentals and disciplined growth. As a result, pitch evaluations are moving at a slower pace.

In contrast to the VC environment of years past, many deals are taking longer to complete. This extended time-to-close leaves room for market fluctuations that can potentially affect the predictability of a business, and therefore the value of a deal for the investor.

The simple strategy for winning during downtimes is patience. Investors can, at times, wear you down with questions that you can’t answer. Sometimes they’re looking for you to give them a reason to say no. You need to find a way to hold on and keep reiterating all the positives of your pitch.

There’s also a balancing act of not taking too long or being too eager. You want to build consistency, which will encourage the investor to enter into a long-term relationship with your company.

What are some of the common themes you heard from investors, both those who invested in and those who passed on Obie?

I think we were able to win by leveraging a strategy of doing things differently compared to our startup and incumbent peers. The fact that we take a partner-first approach to distribution has allowed us to gain quite a bit of domain knowledge and authority. That foundation has grown exponentially as we’ve sold into this ecosystem.

We’ve also continued to reinvest in the sector, adding a B2B2C channel so we can always meet our customers wherever they are. That strategy has the added benefit of a very attractive customer acquisition cost. It’s the third spoke of the wheel that is very new and novel; historically, buying insurance was broker-to-customer, then direct-to-customer through insurtech 1.0. By adding a B2B2C play, we’re able to acquire new customers without having to change customer behavior.

Often, the investors who passed on Obie told us the decision was not about our business in particular, but about the insurance sector as a whole. When unfavorable outcomes for your industry have already left a bad taste in the investors’ mouths, it can be hard to convince them you won’t follow suit. That’s especially true in a volatile economy like we have right now. Additionally, other investors told us that insurtech wasn’t their area of expertise, so in our case they didn’t have enough knowledge to make a confident investment.

What advice would you give other proptech founders who may be looking to raise or are currently fundraising?

If you’re a founder who has raised before, expect a new level of due diligence on your business as investors become more stringent in evaluating growth. You should also expect a longer timeline than you’ve had in the past. There is no rush to fund, so patience is key.

A lot of the success in raising today comes down to relationship building. Keep doing what you say you are going to do. Create confidence that you can continue to do that when you are presenting future forecasts. Execute, and you’ll be trusted in return.