Finding a home online is easy to do but the road to moving in can be a laborious process. Especially in the rental market where much still operates offline.
Across Europe, the rental market is synonymous with hefty deposits, wearisome insurance procedures and move-in expenses. All putting tenants under financial strain.
In this week’s Behind the Idea, we meet Meeri Savolainen, co-founder and CEO at INZMO. The Berlin-based company is looking to help tenants protect their homes and belongings.
Estonian born Savolainen previously worked as a tax and corporate lawyer for Ernst and Young. To fulfil her passion for breaking new ground to lead social change, she left the corporate world in 2015 and founded INZMO with Risto Klausen.
INZMO initially focused on B2B2C solutions across multiple verticals from consumer electronics and bike insurance. But most recently, it launched Germany’s first fully digital rental deposit guarantee service.
Here Savolainen provides insight into the company’s mission of shaking up the rental sector with financial services products.
Tell us more about your company and its offering
INZMO is building the financial ecosystem to serve the European rental industry. We aim to own all of the financial services that tenants and landlords need to avoid and reduce rental debts, with the goal of freeing up liquidity and offering more financial flexibility.
On the tenants’ side: we help people get into homes faster and deposit-free. We aim to offer all of the potential coverage to protect risks in the household and their income. And we help to lift the financial burden of having a place of your own with a small credit product that helps those tenants who need it, to move in and pay the rent.
For property managers/landlords, it’s all about helping them manage renter risk more effectively and avoiding and reducing rental debts. That means making sure rents are paid on time and the cash flow is there so people aren’t getting evicted.
This is how the rental business ultimately operates. When there’s too much bad debt, it ends up hurting both parties. It’s one of the things that the sector is trying to reduce and we’re here to help and fill the gap.
What problem does your company solve?
Moving to a new rental home is exciting. But with every rental home comes a burden of hefty deposits, laborious insurance procedures, and move-in expenses that are a great financial obligation. Eighty per cent of renters in the EU are living paycheck to paycheck. About 35 per cent of their income goes on rent and we want to help them.
Tenants on fluctuating income or spikes in their financial responsibilities are also at a disadvantage. In such cases, evictions are common and an unpleasant experience for both tenant and landlord.
For landlords, it’s common practice to run different credit checks at the beginning of the rental relationship to mitigate risks and ask for high security deposits. Managing this is a massive administrative burden.
We launched Germany’s first digital rental deposit guarantee backed by Société Générale Insurance which is doing away with the hefty upfront rental deposit.
We’re also simplifying the process and taking the administration burden away from landlords, letting agents and property management companies. They can offer the solution to tenants at the point of application and can let their properties out more quickly.
In Germany, there are several landlords who own or manage large portfolios of 1000+ properties. Handling all of those deposits is a time-consuming, and highly regulated, task. INZMO takes the hassle away from landlords as well as the need to transfer large sums of money.
We are also speeding up the typically slow and complex claims process. Tenants and landlords can use photos to verify that the property is being handed back in the same condition as it was rented. It’s quick, easy and, once everything is checked, the policy stops. Both parties can use the INZMO app, they don’t have to spend time dealing with the underwriters, so again, that solves a number of headaches.
Since launch, how has your company evolved?
I co-founded the company with Risto Klausen, a former professional motorcycle road racer and multiple Estonian and Baltic Champion in the Superbike class. It was Risto’s passion for motorcycling that led to an earlier iteration of the company – Bike ID, an international bike registry founded in 2015 to counter bike theft.
“Our ambition is to become a one-stop shop for the tenant’s home insurance needs”
To monetise the platform we integrated an app to sell bike insurance and upon realising the potential of easy-to-use online insurance services, we pivoted the business in 2016 to become INZMO (insurance on your mobile).
Today we focus on providing financial services to the European rental industry – an untapped market by most of the large incumbents.
What has been the biggest challenge or most ‘tricky moment’ to overcome?
A 2018 research study from Boston Consulting Group revealed that for every dollar received in funding, female founders produce 78 cents in revenue, while male founders return just 31 cents. Yet investors are willing to part with only four per cent of funds to female-led startups.
This approach, wildly fueled by prejudice and the perception that women are less successful as entrepreneurs even though the results prove the opposite, is one of the biggest challenges I’ve faced and continue to face as a female founder. It’s a problem that is also exacerbated by the fact that my startup is based in Germany which accounts for a mere four per cent of all female founded startups.
However, the perpetual funding challenge has shaped the way I run my startup – and for the better. We’ve been forced to learn to grow without VC cash, to do more with less and with an approach geared towards responsible and sustainable growth.
I’ve also learnt to become comfortable with the fact that the road to success is paved with losses, mishaps and mistakes, but it can still take you where you want to go as long as you don’t lose sight of your destination. Focus, stay on course and, even better, find yourself a business model that makes money. In order for a female-led company to be attractive to VC money, the company needs to be a high-performing one.
What are your biggest achievements or ‘proudest moment’ so far?
On a professional level, I’m massively committed to gender diversity and really proud of the fact that my startup has a 60:40 female/male split. In fact six of the nine senior leadership positions are held by women.
As a female founder in insurance, a centuries old industry with let’s face it a bit of an image problem – male dominated, overly old fashioned, slow to change, clunky IT systems – I’m acutely aware more needs to be done to attract female talent to the sector.
Our gender balanced business has helped us appeal to a strong number of exceptionally talented female candidates who want to work with us because of the number of women already at the organisation, and who occupy the most senior positions.
On a personal level I’ve learnt to become more patient and a much better listener. As a fast-growing startup and working in digital insurtech which rewards hyperspeed, I’ve been used to quick fixes, being always on and had the same expectation of my teams.
The pandemic however changed all of our working lives. No longer working in-person as frequently with colleagues meant I wasn’t always aware of their personal situations (and vice versa) and how they were having to adapt to address unforeseen challenges.
And, because of that it was important for us all and particularly the senior team members to be better listeners, more respectful of individual situations and understanding of the need for flexible working patterns as we found it had a direct impact on levels of creativity, productivity, and collaboration.
How would you describe the culture of your company?
This is best answered by looking at the words our employees use to describe the culture at INZMO. Freedom to operate, no micromanaging, ambitious, experienced, friendly atmosphere, challenging, flexible, innovative.
Innovation is key and something we cultivate at INZMO. We are highly collaborative, non-hierarchical, we encourage experimentation and are always open to new ideas. However, a culture that supports innovation is often misunderstood. People think it’s just fun, but that’s one side of the coin. Some more challenging and less fun behaviours must counterbalance the easy-to-like ones.
As a business we’re disciplined. We set high performance standards for our people, while also supporting their development. Exploring crazy ideas that ultimately fail is OK, as long as we’ve agreed on the place for failure, but mediocre knowledge and skills and poor management are not. And when it comes to leading innovation, the expectation we place on our senior leaders to lead by example, is equally high.
What’s in store for the future?
We’re always working on developing and enhancing our product portfolio. Looking ahead we’re planning to integrate AI and machine learning into our platform to take even more friction out of the customer journey and enhance the customer experience.
Our ambition is to become a one-stop shop for the tenant’s home insurance needs. From insuring the actual moving process to contents and consumer electronics insurance. And we want to make everything in the insurance process instant. Not only the purchasing of a policy, but in the future, we also aim to make claim settlements in minutes after receipt of a claim.