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Sep 2, 2021

Announcing our Seed Financing

Justin Levine

Justin Levine

Co-founder & CEO

It’s been an incredible journey and today, we're proud to announce Shepherd.

We’ve teamed up with an amazing group of investors, partners, and friends to create a new type of insurance company - built for one of the most important industries in the world: commercial construction.

We’ve raised a $6.15M seed round, led by Spark Capital with participation from Susa Ventures, Procore Technologies, Y Combinator, Greenlight Re, Oldslip, and several strategic angels from within the insurtech and fintech ecosystem.

Our goal is both simple and audacious: make the construction industry safe and sustainable, starting with innovative insurance products. This new capital will enable us to accomplish our mission.

Welcoming Construction’s Second Wave

Since 2015, over $5B of venture capital has been invested into the development of construction technology. Hundreds of new products, hardware and software, are rapidly changing the way contractors design, deliver, and manage commercial projects.

Yet, despite these advancements in project delivery and contractor workflows, until now, financial services for the construction industry remain largely unchanged. We are committed to driving the same level of disruption across the insurance value chain. We believe contractors should be rewarded and incentivized to invest in technology that makes them safer, more productive, or more efficient. And, we’re betting on a world where the data from technology products is inherently tied to underwriting, pricing, and risk selection.

We conceived Shepherd and structured the company as a Managing General Agent (MGA) with two core technology value props:

  1. To digitize the way insurance is procured within construction -- a single end-to-end platform for everything from submission development to policy documents.

  2. To leverage integrations with construction tech partnerships to automate and personalize much of the underwriting process.

By correlating data about contractor behaviors with loss outcomes, we can better price our insurance programs. We’ll focus on casualty lines (General Liability, Worker’s Comp, Commercial Auto, Excess) to start, and gradually expand over time.

Today we’re opening up our brokerage platform (sign up for access here)

Our strategy in bringing Shepherd to market is to build the best tools for construction brokers and give them away for free. We’ve been running closed pilots with a few brokerages for our first offering - a platform for collecting data and developing insurance submissions online. Any account manager or agent using Shepherd can invite their clients to complete an online form in a format of their choosing. The best part? Starting with Procore, contractors can integrate the tools they already use with Shepherd in order to reduce the endless hours spent reproducing internal data on insurance applications. Why would we give our tools away for free? Two reasons: 1) we think brokers and contractors simply deserve a better procurement experience without needless manual data entry, and 2) because our success depends greatly on our partnerships with brokers. We think it’s our obligation to provide value to the market first before asking for anyone’s business later. If you’re a construction broker and would like to try our platform for your next renewal or project specific application, signup on the form above and we’ll get you started on Shepherd.

A great product starts with a great team

I am humbled to be supported by two incredible co-founders, Mo and Steve, as well as the daily energy of our growing team here in San Francisco (now 7 strong). I've spent my whole career in this industry. After graduating from Georgia Tech I chose a path in construction because I wanted to get my hands dirty (literally), be outside, and self-actualize in the work I was doing. Almost as soon as I started as a project engineer in the field I realized that I was actually more drawn to a different side of the business altogether - the operational back office. I wanted to know how the sausage was made - what made a construction enterprise successful, and why? I took a risk finance role at Hunter Roberts, working directly for the COO, and the experience changed my life. After 3 years I left, founded a SaaS startup, sold it twice, and took a deep breath to reset. Now I'm coming back to try something bigger, loftier, and immensely exciting to me personally.

My co-founder Mo is a self-taught engineer with a history of tackling big complex problems. After beginning his career at a few small startups post-college he landed a breakthrough role, on an incredible team, at Airbnb. There, he built, iterated, and delivered on Airbnb's entire internal messaging CMS — a single platform to govern all of the company's communication (2+ billion emails) to the outside world. His technical talent stands second to none, and his magnetism as a founder is helping us quickly scale our product team with amazing new hires.

Our other co-founder, Steve, has long been a rising (yet humble) star in the construction insurance world. While he gained a reputation as a stellar underwriter and leader, I've long known Steve to be an innovator who pushed boundaries — always in search of new ways to modernize the underwriting approach of large companies like AIG, ACE, and most recently Chubb where he led the construction practice. At Shepherd, Steve will combine years of experience profitably underwriting the construction space with a true sense of innovation.

Capital to accelerate growth

We have the support of some of the best investors in Silicon Valley. Natalie Sandman, partner at Spark, joins our board. Natalie's background as an early product lead at Zenefits is especially impactful on our own product development for the Shepherd platform.

Shepherd is the first investment made by Procore, who completed its successful IPO in May of this year. Procore is the #1 project management platform in the construction industry, with 14,000+ customers and billions of dollars of construction volume being managed annually on their platform. We'll be writing more in the coming weeks about our relationship with Procore, but the partnership with their team is significant given their scale and reach within the industry. We're excited to collaborate with them and their clients to create a more integrated procurement experience as well as data-driven underwriting for our products.

With this initial financing we’ll invest primarily into our engineering and underwriting teams, the two pillars of what makes Shepherd unique. We have several open opportunities on our team. Come join us and help bring our first insurance products to market in Q4 of this year.

This company is bound to mirror the industry in which we operate. Like construction, the road ahead is difficult, unpredictable, and interdependent on many stakeholders. Our mission is what will keep us grounded and on the right path. We’ll start small and focused, building the foundation to leverage data into our underwriting, and, over time, begin to evolve traditional underwriting models into something connected, and data-driven.

At scale, every Shepherd customer will be underwritten not just based on their history or the locations that they operate, but rather reflective of the investments they’re making into their businesses and employees. Technology is already changing the construction industry for the better - it’s time for insurance companies to embrace this same movement. Shepherd is the company that we have always wanted to build - pioneering new ways to solve old problems and setting a new standard for technology enabled insurance in the construction industry.


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