Our guiding principles

We started life as the in-house tech team for our High Net Worth MGA. Shareholders then asked us to build digital products for them and after we had sold the MGA to Aviva last year, we split off the tech business and started selling our product building skills to the MGA market. It was a natural evolution. However, if I reframe the question and articulate what I think are the most important considerations in building a business like Azur Technology I would suggest the following:

1. Pick a big niche

Azur is currently a business of 40 colleagues, and we have big ambitions. We have focused on global MGAs as the part of the insurance industry where we can have a meaningful impact. It is big enough for us to 10x business but also niche enough for us to beat high profile but generalised technology companies serving the industry. We also think that as we started life as an MGA, we are well qualified to understand what is strategic, affordable and value enhancing for MGAs.

We also think the ‘SaaS plus Managed Services’ model is strong for companies who choose not to build an inhouse technology capability and want a long-term partner. The high renewal rates, for both customers and suppliers, make insurance a terrific niche in which to work.

2. Make the business sustainable

You cannot control timing in business. You hope you have picked the right time to launch or scale a business, but markets are unpredictable. There are two sources of funding available to a company like Azur. Investment and re-invested profits. We raised £2m to invest in the business, largely in Sales and Marketing and Product Development. Any funding we need will come from the profits we make serving our clients. This model allows us to be in the market at two important times. One when the market wants to scale and adopt our products in volume and one, when the liquidity window is open. Liquidity is about selling shares to generate returns for colleagues and investors. These windows may only open every 5 or 10 years so you must be able to sustain the business for a long time.

There is a huge issue with always going to investors to sustain the business. At some point they will lose faith in management and secondly this investment is like a big mortgage, usually paid in a preference, that rewards later stage investors at the expense of early investors, founders, or colleagues.

3. Talent first

We live in a talent-centric world. It is a great time to be a highly skilled and motivated person. Our team at Azur are trusting me with important stages of their careers and I need to do everything I can to help them succeed both at Azur and in their careers moving forward.

We believe in hiring the best people who have the skills we need and who are brilliant at using the tools we have chosen. The 10X software engineer is a real phenomenon and we organise into small squads and give them the best ‘power tools’ we can. We take time to add the skills people need, for example they may not have worked in insurance, so they will know what code components to use for which insurance process.

Recruiting the best people is expensive so we need to build tenure into our model. This means helping our colleagues to balance ambition, work life balance and interesting work. High stress, death march projects and heroics are not sustainable unless you want to work for Elon Musk!

Culture in a remote first company like ours is challenging and we have by no means figured out all the answers. We are investing in flying colleagues, sometimes from the other side of the world, so that we get regular face to face opportunities. Like many companies we know we need to make the times we get together fun and worth the investment people make in travelling or commuting.

Be ambitious for yourself and your colleagues. Colleagues only benefit at a meaningful renumeration level with significant business success. As I mentioned earlier, typically founders and angels have a preference on the equity and scoop most of the value at low levels of success. Building a valuable business will create more rewards to be shared with colleagues.

4. Architecture matters

Technology decisions are hugely important, and it is critical they map to the problems you are solving both for your business and your customers. Given the long timeframes involved and the regulated nature of the insurance industry, customers need to be able to make a long-term bet on the financial viability of the business. As a global niche tech provider, we have achieved this by building on the Salesforce platform. Every business will pick the right tools but, for us, being able to add value to a $200bn enterprise application platform giant, in the insurance product and processes layer, removes a huge viability question and stops us doing too much re-inventing of the wheel. Add in the multi-tenant architecture and the underlying insurance capabilities, Salesforce is a great fit for ambitious MGAs.

If you get your architecture wrong you will have a sprawling code base, requiring regular refactoring and significant technical debt that will stop you scaling.

5. Strategy

One of the common mistakes many businesses make is to spend all their energies working on customers’ businesses and not enough on their own business. One client of mine rather tartly referred to this as being ‘busy fools’. Clearly you will only stay busy if you solve customer pain points, but you need a strategy for how you are going to build IP and leverage into your business model. Clearly SaaS businesses have cracked this challenge but services companies, both IT and Managed Services, largely deliver bespoke code that is not always easy to leverage.

Our Product Strategy is still being developed but we need to build a product layer on top of Salesforce that helps customers launch products more quickly and allows us to service 10X the number of clients. We are already a good business but if we want to be great, we must crack the product strategy challenge.

6. Investors

My final consideration is attracting the right investors. The UK has a great scheme for attracting Angel investors. EIS is well known, and successful investors are always looking for good businesses that are EIS eligible. Angels are typically long term, they are generally happy to wait for the business to achieve its full potential, if it is self-funding! We avoided corporate investors or institutional money. Company investors can either limit the exit options or have agendas that don’t align with other customers or shareholders. Institutional money is only needed when you have everything nailed down and you need their fuel to launch the rocket ship!

The hope is that the returns investors make is recycled into the next round of companies founded by some of my brilliant colleagues!