Marketplace founders can add insurance as a revenue stream, not just a cost. Rental-period insurance protects owners from liability during bookings, while personal-line insurance requires separate policies in all 50 states. Amazon turned AWS from a cost center into a major business, showing how to embed revenue services into your platform.
Chapters
So a lot of founders here in the community are thinking about how they can, you know, offer additional kind of value adds or value props to this marketplace, such as insurance, right? But it sounds like it took you quite some time though to initially offer insurance and then, you know, launch Roamly. So could you share a little bit more about like what that time period was like and what, you know, what all went into actually kind of rolling this out?
Yeah, now I should break down insurance. There's a couple of flavors within this. One is the insurance during the rental period. And so that was pretty early on that we figured that out. It was not easy. I mean, Jeff pitched many insurance companies and again, maybe sounded crazy to most people. And we probably, in hindsight, that was the linchpin to all of the business, at least in hindsight. And so that was That was one type of insurance is just making sure the rental period's covered such that the biggest question mark on the supply side of providing your RV for rent is, will it be covered if someone else is driving it and it's in an accident? Will I get my money back, so to speak? And then the other flavor is on the personal line of insurance. So think you own a car, you get your GEICO, your Allstate, Progressive, maybe it's Metromile, whatever it may be, your insurance policy. That one is where that's taken a bit longer road because that is a filed policy. And so therefore you have to do it in every state. So there's just inherent idiosyncrasies to filing insurance policies in all 50 states since it's state mandated. But yeah, so that, in terms of value-add, that's where we spent a lot of time and effort. Insurance became a very great way for us to monetize, one, the rental period. So the renter buys the rental insurance. We also provide in the flow trip cancellation insurance, like you would with airlines or things like that, but also interior damage insurance. Interior damage insurance, I'm sure most people have rented a vacation rental before, the security deposit, right? You put some security deposit down, you're like, oh my God, I broke a window, or I don't know, did something. Am I going to get my security deposit back or less? Well, interior damage insurance is essentially an offset to the security deposit. I'd rather just pay an upfront cost to have a certain amount of coverage. And I'd say one of the insights for people as you think about monetization is your cost centers are oftentimes your revenue centers. You just have to flip it on your head and how you think about it. I mean, I think that the best example, one of the most profitable examples of this is Amazon with AWS, right? They just kept getting more and more servers to obviously support their growing business, but then they realized, well, look, if you turn this on its head and use this capacity that you have here, you can actually make it a revenue center. Because people often think about how to embed it and provide it free of cost or charge to people, that may not necessarily be the best strategy overall. And so I would encourage people to think about how you take those cost centers and turn them into a revenue center.
