VC-backed companies are eligible for the PPP loans subject to guidelines, which include affiliation rules regarding venture ownership and negative covenants. Link to a summary of applicability.
One outcome of the Covid-19 pandemic could be a significantly more difficult capital raising environment which could threaten startups and early stage companies.
The original article has been split into the Covid-19 virus (Coronavirus) information, which has changed from a week ago, and The Case for Contingency Planning. This article retains the original information on Covid-19.
The Covid-19 virus (Coronavirus) has spread worldwide, and all organizations should be assessing their exposure, specific challenges, and planning steps they can take. The Covid-19 virus may be a survival threat for startup and early stage companies, including Insurtechs, trying to get traction or ramp up sales. The ability to raise capital at a favorable valuations, or at any valuation, may be significantly impacted.
Pitch decks are important for raising capital, and a good pitch deck can get key investors interested, maybe even committed. Explaining your Insurtech company and strategy, along with the investment structure, in a clear, concise and compelling manner can make the difference.
Venture capital funds, angel investors and startups should be cognizant of cyber crime exposures and the preventive steps available. Most of capital raise transactions involve wire transfers, prime targets for cyber criminals.
Technology is bringing change to the insurance industry and regulation may not keeping up with the pace of technology change. But insurance regulations have been developed over many years for a reason. Insurtechs should work within the current regulatory structure and with regulators, and keep in mind the regulators’ primary objective of protecting insurance buyers.