Alon Huri vividly remembers the longest 22 minutes of his life. And no, it wasn’t final month when he was ready for the ultimate determination from German insurance coverage large Munich Re on whether or not to signal a $2.6 billion test for Subsequent Insurance coverage, the corporate he co-founded. It occurred precisely three years earlier than that historic deal was signed—when Huri, then simply 45 years previous, discovered himself stranded on Freeway 6, ready for an intensive care ambulance after struggling what paramedics would later verify was a extreme coronary heart assault.
“I hadn’t been feeling nicely because the morning, however I got here to the workplace as traditional,” he says in an unique interview with Calcalist. “I went to lunch with Nissim (Tapiro, co-founder and CTO at Subsequent Insurance coverage), and the heartburn I’d had all morning bought worse. I keep in mind it was very chilly, however I used to be sweating nonstop. I made a decision to go house early, and once I known as my spouse from the street, she instantly advised me, ‘You haven’t left the workplace in the midst of the day in 20 years—pull over now and name an intensive care unit, not simply any ambulance, however the yellow one. You may have all of the signs of a coronary heart assault.’”
Since Huri was in the midst of nowhere—on the freeway between the Subsequent Insurance coverage workplaces in Kfar Saba and his house in Ness Ziona—getting medical assist wasn’t straightforward. He needed to ship the ambulance staff his location by way of a particular app and wait what felt like an eternity. “It was ‘fortunate’ that my father additionally had a coronary heart assault at a younger age. I remembered the signs and the way rapidly issues escalated. Only a week earlier, I ran 7 kilometers and felt nice,” Huri recollects. He ranks that day because the second most life-changing occasion in his life—between the primary and smaller exit of “solely” $360 million, which he made with the sale of Test (based together with his longtime companions Man Goldstein and Tapiro in 2014), and the current main exit.
“On the best way to this interview, I believed to myself that this complete rollercoaster I’ve been on for the previous three years nonetheless doesn’t really feel actual,” he says. “I really feel like I’ve been reborn, and generally when folks ask, I inform them I’m three years previous. That occasion modified my total outlook on life. Since then, I’ve spoken concerning the coronary heart assault on each potential platform, as a result of well being is crucial for entrepreneurs—but it surely’s one thing we are inclined to neglect. It’s so essential to not ignore your well being and to get checked. I hadn’t had a correct check-up in years due to COVID. Since I posted about it on LinkedIn, only a week earlier than the Subsequent sale was introduced, I’ve been flooded with messages from entrepreneurs telling me they bought examined, purchased train bikes—even sending me their blood take a look at outcomes. The response was overwhelming.”
Do you suppose it has to do with the stress entrepreneurs are beneath? Your public picture is sort of glamorous: networking occasions, fancy dinners with purchasers…
“Clearly. Being an entrepreneur for 17 years means residing beneath fixed stress. You don’t all the time sleep nicely, you eat irregularly, and there’s ongoing psychological stress.”
Huri’s put up obtained a whole bunch of feedback and shares. Many within the high-tech world admitted to experiencing anxiousness assaults and to persistently delaying medical checkups in favor of one other assembly or presentation. Some even shared pictures of their clogged arteries.
In the long run, is that what made you step away out of your ‘child,’ Subsequent Insurance coverage, a 12 months and a half in the past and be part of the fintech fund of Team8?
“It made me take a step again. The opposite two founders supported me and advised me, ‘Do what you need.’ I really feel like I’ve obtained a lot from the universe, and now I need to give again—to assist the following technology. My goals in the present day should not about cash. Even the proceeds from the Subsequent exit gained’t change my life. My dream now could be to construct the following ten Nexts. That’s all I need to do. It additionally has nationwide significance: for each missile fired right here, we have to construct a unicorn.”
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Subsequent Insurance coverage founders (from left): Alon Huri, Man Goldstein, Nissim Tapiro
(Credit score: Subsequent Insurance coverage)
“2025 will probably be vital—in opposition to all odds”
In these 22 lengthy minutes ready for the ambulance, Huri by no means imagined that precisely three years later, he’d assist seal one of many greatest exits in Israeli historical past. The sale of Subsequent Insurance coverage to Munich Re is the biggest fintech exit ever in Israel, and the biggest insurtech acquisition globally amongst venture-backed corporations. The deal was introduced in the identical week as Wiz’s $32 billion exit, which understandably grabbed the headlines. However whereas Israel already enjoys a powerful world repute in cybersecurity, the Subsequent Insurance coverage deal marks a significant milestone for its fintech ecosystem.
Subsequent Insurance coverage focuses on small and medium-sized companies within the U.S., providing digital merchandise reminiscent of normal legal responsibility and employees’ compensation insurance coverage. The corporate has proven constant development, producing $548 million in income in 2024 and serving greater than 600,000 clients. The U.S. promote it targets contains over 30 million small companies throughout 1,000+ professions—representing 99% of all corporations and 44% of U.S. GDP. But about 75% of those companies are thought of underinsured, making a extremely fragmented $175 billion alternative.
“In my opinion, the timing of the deal can be crucial,” Huri says. “Each it and the Wiz deal had been signed throughout the warfare, and the consumers had been nicely conscious of the state of affairs in Israel. That’s a badge of honor and an enormous increase for the whole ecosystem. It’s additionally a sign to buyers. That’s why I’m optimistic—this opens the door to a really vital 2025, in opposition to all odds.”
Though you’re now not at Subsequent Insurance coverage, you’re nonetheless a big shareholder and advisor. Have been you in favor of the sale?
“When this supply got here, we had been all in favor. There had been earlier presents we didn’t need.”
How a lot do every of you personal, and the way a lot will the State of Israel obtain from the deal?
“We don’t share these numbers, and I don’t even understand how a lot the state will get. From a private standpoint, this exit didn’t dramatically change my life after the Test sale. I don’t even understand how a lot I’ll obtain, however I do know every thing will keep the identical. I’ll hold residing in Ness Ziona and dealing at Team8. Perhaps I’m residing within the Matrix,” Huri laughs. “However that’s my goal now—I can’t simply sit on the seashore.”
The exit is spectacular, however you had a prospectus practically prepared for an IPO. You’ve stated in previous interviews that Subsequent Insurance coverage may hit a $10 billion valuation—perhaps even $100 billion if every thing aligned. However in the identical week, each you and Wiz gave up on that chance by promoting.
“There’s a fundamental assumption that an IPO is all the time higher than a sale—however I’m unsure I agree. It relies upon: is it higher for workers, buyers, founders, clients, the corporate being acquired, the customer—or for the State of Israel? A sale is nice for the state, which will get a direct windfall. For workers and entrepreneurs, it’s superb. For the corporate, it is dependent upon the case.
“I’m a Zionist, and job creation is a KPI that issues to me. Our earlier exit, Test, was bought to Intuit, and their Israeli R&D heart is now the biggest exterior the U.S. We had 100–150 staff on the time, and now there are a number of hundred. That began with an acquisition. Each time I meet somebody who nonetheless works there, I get chills.
“And the Subsequent deal may have a good larger impression—it is going to be an unbiased division that continues to develop in Israel. One plus one will equal three, as a result of the operation will finally be much more worthwhile. That is Munich Re’s entry into the U.S. market. Our imaginative and prescient was to construct the biggest small enterprise insurance coverage firm within the U.S., and now that aim feels extra achievable than ever. Till now, we had been vital—however we weren’t primary.”
“Precisely the proper value”
Test, which developed a private monetary administration app with 10 million customers, had a comparatively fast and profitable exit. It raised simply $47 million throughout three rounds earlier than being bought seven years after its founding.
Subsequent Insurance coverage, in contrast, raised $1.2 billion over eight funding rounds, and its founders noticed vital dilution of their stakes. The buying firm, Munich Re, started investing after the Seed spherical and by the point of the acquisition held practically a 3rd of the corporate’s shares. So whereas the sale value of Subsequent was far greater, it is potential that the quantities in the end obtained by the founders in each exits aren’t very completely different—seemingly within the tens of thousands and thousands of {dollars} in every case.
You may take a look at an exit when it comes to who advantages, but it surely’s additionally essential to contemplate the short-term versus long-term implications. Within the quick time period, everybody’s completely satisfied and income—however the greater query is what this implies for Israel and its high-tech business.
“If I had to decide on between being the founding father of a $100 billion firm or beginning the following ten Nexts and making much less cash, I’d select the second choice.”
After the sale of Test, did you’ve any regrets?
“We had been all the time okay with it. In hindsight, we went on to construct an even bigger firm. After we based Subsequent, we constructed it with an IPO in thoughts—that’s the way it ought to be. Anybody planning to be acquired from day one has the fallacious technique. That stated, a compelling supply can all the time come alongside, and that’s simply how the market works. Munich Re, which acquired us, can be our reinsurer and certainly one of our largest shareholders. You could possibly say they know us higher than we all know ourselves. They perceive the enterprise and acknowledge that it is a actual firm that’s going to develop—with out inflated price-to-revenue multiples.
“There’s been numerous discuss insurtech ‘promoting a shekel for 80 agorot,’ promoting goals. However the previous 12 months has proven it’s too quickly to put in writing off the sector. Lemonade, one other Israeli insurtech firm listed on Wall Avenue, is buying and selling at a $2 billion valuation and is displaying improved efficiency. Within the early days, the market rewarded loopy development in any respect prices. That’s what everybody pursued, as a result of in any other case folks would say you don’t perceive the market. After the correction, the truth that we knew the best way to adapt is one thing we’re pleased with.”
When Huri talks about how, not like the Wiz-Google deal, the Subsequent Insurance coverage acquisition didn’t contain “loopy multiples,” he’s completely proper. To know that, we return to March 31, 2021, when Subsequent introduced an enormous $250 million fundraising spherical at a peak valuation of $4 billion—a degree it hasn’t returned to since.
Though this present deal is among the many largest tech exits in Israeli historical past, it nonetheless represents a 35% drop from that earlier valuation. On the time, in an interview with Calcalist, Huri and his co-founder Nissim Tapiro stated:
“We don’t need to be acquired; we need to construct a big, unbiased firm. A few of our buyers are insurance coverage corporations, and that’s factor.”
Additionally on the time, they stated one thing nearly prophetic:
“From day one, the insurance coverage business embraced us—together with corporations that invested in us, like Munich Re—as a result of they understood that the insurtech revolution is inevitable. They usually additionally understood that they wouldn’t have the ability to lead it themselves, as a result of it’s a matter of DNA. It took us some time to totally internalize that, however even when a big insurance coverage firm hires 600 builders to do one thing digital, it might probably’t remodel right into a startup. If somebody manages to crack that—good for them.”
In the end, Munich Re did crack it by writing a test to increase its presence within the U.S. market by way of Subsequent Insurance coverage. By 2024, Subsequent had reached an annual income run charge of $500 million and, in line with the customer, had been rising at 25–30% yearly lately.
May you’ve gotten the next valuation from a purchaser much less acquainted with the corporate than Munich Re?
“That is precisely the worth it ought to be.”
So how do you reconcile that with the $4 billion valuation you raised at in 2021?
“Certain, we may’ve gotten the next valuation, however we didn’t need to. It’s not good to maximise valuation throughout fundraising since you’ll must ship on that later. There’s a dynamic to how issues evolve. This deal is a good value for everybody concerned.”
“We needed to keep away from an IPO too early”
Take Lemonade, for instance. It went public and, after all of the ups and downs, is now buying and selling at roughly the identical valuation as Subsequent’s sale value. You could possibly have achieved an IPO in 2021 with the remainder of the market and perhaps hit a $10 billion valuation.
“At that time, we weren’t prepared for an IPO, and we intentionally needed to keep away from that type of untimely transfer. From day one at Subsequent, we outlined our aim as constructing a worthwhile, predictable enterprise—and in 2021, we weren’t there but. Certain, when Lemonade hit $11 billion throughout the hype, folks advised us we had been making a mistake. However being an entrepreneur additionally means standing by your rules. We stated: Perhaps we’re fallacious, but when we don’t consider in it, we’re not going to do it. We may have gone public, but it surely didn’t align with our imaginative and prescient. The primary two years on Wall Avenue are all about constructing investor belief, and we weren’t prepared. We don’t remorse it.”
As we speak, Huri describes his function on the Team8 fund—provided to him by former Financial institution Leumi CEO Rakefet Russak-Aminoach and eToro co-founder Ronen Assia, who’s now making ready for an IPO—as “like being a child in a sweet retailer.”
“What excites me most is working from minus one to zero,” Huri explains. “Everybody talks about going from zero to at least one, however what I’m doing now could be much more attention-grabbing. That early ideation stage—that’s how we considered Subsequent after promoting Test. After we left Intuit, Man (Goldstein, CEO of Subsequent), Nissim, and I spent 4 months considering deeply about our subsequent enterprise. That type of considerate course of could be very particular for somebody who’s already had one exit. Right here at Team8, we work with first-time founders and train them the best way to break down issues, kind validation theses, and establish the proper answer.”
“AI is an earthquake within the subject of programming”
Is there nonetheless room for brand spanking new startups within the fintech business? Lately, the sector has been disappointing, elevating questions on whether or not it nonetheless has a motive to exist in a world the place rates of interest are now not at zero.
“Fintech, like cyber, is a broad time period—and there are nonetheless many alternatives to construct new corporations. However not like cyber, which tends to scale rapidly, fintech behaves in a different way: there’s often a protracted hole between the adoption of an answer and a surge in income. However when it really works, it explodes and reaches greater valuation ranges. And whereas cyber will get extra of the highlight, Israel is definitely a powerhouse in fintech. We have now globally vital corporations right here—from Lemonade and Tipalti to eToro and Rapyd.
“On the startup degree, I’m at present exploring the world of worker medical health insurance for organizations. The Subsequent deal has reignited my ardour to construct new fintech corporations, as a result of it proves that it’s potential to create an enormous on this area out of Israel. What I’d like to see are new corporations began by alumni of Subsequent—simply as many corporations emerged from Mercury, the place Man and I met. Mercury, which was bought to HP for $4.5 billion in 2006, continues to be one of many greatest exits in Israeli tech historical past. It produced founders of corporations like Navon, Zuz, 8fig, HiBob, and lots of extra. The entrepreneurial ambiance there was unbelievable—one thing really particular was constructed.”
How does Israel handle to supply so many profitable fintech and insurtech corporations, regardless of not having an apparent comparative benefit?
“There’s one other glass ceiling that Subsequent shattered—and it doesn’t get talked about sufficient: it was the biggest-ever acquisition of an organization promoting on to small companies. Additionally underappreciated is Israel’s power in on-line advertising. We have now a number of the greatest groups on this planet working with Google and Meta platforms. That’s as a result of Israeli corporations are constructed for export from day one, and advertising occurs remotely. Simply take a look at Wix, Monday, or Resident, which was bought for $1 billion—all are examples of that mannequin. Lots of their folks got here from corporations like 888 and Playtika, which helped foster an impressive technology of efficiency entrepreneurs.
“At Subsequent, we scaled from zero to a $2 billion valuation with out brokers or partnerships—simply with 15 efficiency advertising professionals. Israel additionally has world-class information expertise, which is a key basis for fintech. Altogether, this kinds a compelling ecosystem.
“Now with ChatGPT and comparable instruments, you possibly can optimize the solutions and create fully new advertising options. It’s a brand new world—and fertile floor for Israeli innovation,” says Huri. “And after we discuss AI, we have to discuss concerning the earthquake it’s inflicting within the subject of programming. As we speak, somebody with no coding expertise can construct a product simply by writing a immediate. The place it used to take $5–8 million to construct a product within the early phases, now you possibly can go from seed to Sequence A with simply $2 million and three robust entrepreneurs.
“That is going to alter the best way we take into consideration startup constructing. Extra ventures will probably be potential, as a result of you possibly can take a look at many instructions in a single day, whereas saving numerous developer hours. You’ll have the ability to make extra errors early on—earlier than investing closely in a product—which can enhance a startup’s possibilities of success. It’s a singular leap ahead.”
“You need to fall in love with the issue, not the answer”
Given the present atmosphere, are there nonetheless new entrepreneurs? Is there sufficient motivation to begin corporations?
“This previous 12 months I met with 400 entrepreneurs—and it’s superb. I do know it sounds unusual, however I might have been prepared to pay out of my very own pocket simply to maintain doing what I do at Team8. I had no thought I’d be so enthusiastic about it. There are numerous nice concepts and robust founders. The tougher issues get right here, the extra resilient we turn into—it’s the beginning of a brand new Israeli DNA.”
Out of your expertise as a serial entrepreneur, what do you search for in a brand new enterprise? What are your standards?
“You need to fall in love with the issue—not the answer—as a result of the answer is fluid. The issue must be large and painful, and it’s essential to perceive that you will be engaged on it for a few years. One of many greatest errors we made at Test was focusing solely on the answer. That’s why Intuit nonetheless makes use of our expertise in the present day, however not the merchandise themselves—regardless of the eight pivots we made.
“You additionally should be a bit of loopy—like a salmon swimming upstream. Each morning you get up and really feel just like the world is in opposition to you, like gravity is reversed. Everyone seems to be telling you why it gained’t work. However on the identical time, it’s essential to encompass your self with individuals who aren’t afraid to talk their minds, and it’s a must to be open sufficient to hear. In the long run, it’s essential to be each cussed and receptive—it’s a paradox, but it surely’s the closest factor to actuality.”
What modified for you between Test and Subsequent Insurance coverage that made the latter extra profitable?
“We had been extra mature. At Test, we made numerous errors. At Subsequent, we made completely different errors—however at the very least we didn’t repeat the previous ones. We understood from day one which we would have liked to deal with the enterprise mannequin. Before everything, take into consideration the enterprise—and that can lead you to the proper expertise, not the opposite approach round.”
“The long run is the one factor that pursuits me”
Did your coronary heart assault change you as a supervisor or entrepreneur?
“It’s not like I finished working arduous—somebody as soon as stated, and rightly so, that my gearbox solely has fifth gear. However I attempt to stress much less. Folks fear about missiles or terrorists, however they don’t notice that the true ticking bomb may be inside your individual physique. My carotid artery was 99% blocked.”
All through this interview you’ve been surprisingly optimistic. Are you not involved concerning the state of affairs in Israel or the departure of tech employees?
“As an entrepreneur, you are inclined to suppose strategically—not simply concerning the second. I totally perceive the complexity of the present state of affairs. However in the long run—which is the one factor that actually pursuits me—so long as we proceed to execute and make progress, every thing will transfer ahead. The following Wiz and the following Subsequent will probably be constructed.”
However ultimately, each of these corporations are registered within the US.
“That doesn’t matter—their contribution to Israel’s economic system continues to be clear. We determine on a case-by-case foundation whether or not to register an organization within the US or in Israel. It’s often based mostly on the character of the enterprise. Subsequent was registered within the US purely for operational causes—to serve the American market extra successfully.”
And if democracy collapses—who will put money into the following Subsequent Insurance coverage?
“I’m not concerned in politics, and my opinion isn’t what issues. What does matter is that everybody focuses on doing what they do greatest to form Israel’s future. I’m an über-optimist as a result of I consider these issues will probably be solved—and I’d somewhat put my vitality into actions that can repay in the long term.”
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