Occupying an imposing building in Marylebone, London, Kamet turns the traditional seed funding model on its head. Whereas most seed funders are approached by founders enthusing about how their startup will disrupt a market, Kamet develops disruptive businesses in-house and looks for entrepreneurs to lead them.
Founded in 2016, Kamet now has 15 companies in its portfolio disrupting the insurance, health and transport sectors. Businesses include Apricity, which calls itself a virtual fertility clinic, and car maintenance platform Fixter.
The key difference between Kamet and other seed funders is that it is supported by French insurance giant AXA, which has backed the concept with €180m (£160m) of funding. In exchange, AXA gets first look at Kamet’s startups, either going on to fully fund them or participate in subsequent funding rounds.
Stéphane Guinet, CEO and co-founder of Kamet, says: “We’re a start-up building startups. We join forces with seasoned entrepreneurs who have exited companies and are looking for their next challenge.”
Executive partner Michael Niddam explains: “We’re not looking for companies, we are looking for entrepreneurs searching for their next project. We offer a place where they can be challenged and supported in a great business opportunity in the insurance or health tech fields. We provide infrastructure and capability to increase their chances of their success in these fields, a full suite of services which can accelerate their chances of becoming category leaders.”
‘Having ideas is the easy part, executing the idea is difficult’
For Kamet, having the idea is the easy part, it’s executing the idea which is difficult.
Guinet says: “Unlike other models, we join with entrepreneurs as an entrepreneur in residence. Having ideas is one per cent of the problem; 99pc of the work is turning that idea to a design and then to first customer.”
Niddam adds: “What we’re really looking for is entrepreneurial talent; if they don’t have ideas, we’ve got plenty of them.”
Kamet, which has offices in London, Paris and Tel Aviv, has a staff of around 20 people sifting and developing startup ideas. Kamet provides the infrastructure, pre-seed and seed funding over a 12 to 24-month period until a business is ready to take on Series A financing. After that, Kamet takes on more of a mentoring and advisory role, joining the board.
Guinet says: “It’s a bit of a unique model. Entrepreneurs join forces with us and together we co-build companies. We don’t see ourselves as financiers but as partners and co-founders. But we’re not doing shadow management, we’re steering and coaching.”
Kamet’s 15 companies to date have raised €200m so far.
Out of the 15 companies, 11 have raised Series A, two have raised Series B. AXA has led funding rounds with seven of them and has participated in funding rounds for the other four.
If you’re in the insurtech or medtech sectors, Kamet provides a gateway to AXA’s 10 million potential customers in France alone.
“We’re offering an unfair competitive advantage,” Guinet smiles, “which startups would not get if they were not part of this ecosystem.”
The company aims to launch around five businesses each year and has anything between 15-20 business ideas in development at any one time.
Guinet says: “When our companies are ready to raise external funding, they do so either through AXA, which is a shareholder in Kamet and has privileged rights when it comes to funding Kamet portfolio ventures, or the company raises money through the usual suspects.”
It’s an approach that has paid dividends for Apricity, which has gone on to raise €8m so far entirely through AXA – €2m in seed funding and another €6m in Series A last February. It plans a Series B round in 2020.
Apricity is a digital platform that aims to disrupt the $17bn global infertility market, which is growing at 8-10pc per year. Already live in the UK, it plans to expand to Spain within 18 months, followed by France, Germany and the rest of the world. Apricity keeps women or couples struggling to conceive up to date with how their treatment is progressing. Often, fertility is about timing and Apricity notifies patients when they are at their most fertile or when they need their next drug dosage.
Different and disruptive
Andrew Berkley, co-founder and COO of Apricity, says: “Kamet approached me with its fertility solution, which is different and disruptive. Normally entrepreneurs have an idea and they approach the investor; with Kamet it’s the other way around.
“In the early days we were able to tap into the resources that Kamet has – HR, accounting, legal, tech, business development. It really helps us as entrepreneurs to shortcut the start. Kamet helps us with resources. Yes, the finance, but it’s the connections pushing us forward and getting us in front of the right people at AXA. We’re partners in this together.
“Kamet is not just an investor, it’s a strategic partner. They’re there to help you develop your business. They give you everything you need to form your business and grow it, to scale. The pressure of private equity investor is not there. It’s partnership and true collaboration because they want you to succeed.”
Limvirak Chea, chief executive of Fixter, agrees: “Kamet gives you the initial backing, expertise, the playbook on how to handle your launch with AXA as an investor. It helps you to go faster You benefit instantly from the support of a big insurer.”
Guinet, a mathematician by training, was CEO of AXA Global Direct for eight years, which became a £3bn business with seven million customers under him, as well as a member of AXA Group’s executive committee.
Before joining AXA, Guinet co-founded and led two startups in France himself: insurance aggregator Assurland.com (now owned by Covea Group) and insurance middleware company Prima Solutions, which he sold to Carlyle for €3.5bn.
After eight years working inside a conglomerate like AXA, Guinet found himself getting restless.
Guinet says: “I wanted to get back to what I loved, which is building companies. I proposed Kamet to AXA.”
So, what advice would an existing in-house entrepreneur offer a fellow founder thinking of approaching Kamet for backing?
Fixter CEO Chea says: “You need to make sure that you’re addressing a big market and you have a good way to approach it. For me, what Kamet does is accelerates that going to market.”
Niddam adds: “We’re just at the beginning of this. There are a lot of areas that can be invaded and be disrupted.”